Valve's Gabe Newell Thinks Windows 8 Will Kill PC Gaming; Plans Penguin-Flavored Future

Valve founder Gabe Newell had a conversation with VentureBeat recently in which the company CEO dropped some rather odd predictions concerning the future of the PC market. Newell took time out of his busy day spent rolling around naked on heaps of money and thinking of things to do besides Half Life: Episode 3 to share his opinion on Windows 8. Here's the exchange as recorded by VB reporter Dean Takahashi:
Q:What are some of the projects you’re working on?

A: [W]e’re trying to make sure that Linux thrives. Our perception is that one of the big problems holding Linux back is the absence of games... I think that Windows 8 is kind of a catastrophe for everybody in the PC space. I think that we’re going to lose some of the top-tier PC [original equipment manufacturers]. They’ll exit the market. I think margins are going to be destroyed for a bunch of people.

This was a PC catastrophe

First, let's tackle that "margins are going to be destroyed for a bunch of people" idea. News flash, Gabe -- That already happened. When HP was looking to unload its PC business last August, everyone took a good hard look at the company's financials. HP's personal computing business, absent the server/workstation market, had a 4.6% operating profit. Dell's profit margin?  4.4% -- and that's actually company-wide, as opposed to being PC-specific.

I don't take much credit for calling business trends, but truthfully, I saw this coming fifteen years ago. Back then, the $999 PC was a huge deal. And it was big -- the $999 PC I bought sans monitor was the system on which I first played Half Life. It was also a time when everyone was singing the praises of Michael Dell and talking excitedly of the coming age of the $899...the $799...the gasp $599 PC.

The nagging issue of margins, and the inevitable impact on system quality kicked off by the race to the bottom was neatly kicked under the rug, lost in the dotcom boom. And here we are, fifteen years later, in a universe where Microsoft had to show OEMs how to innovate (thanks, by the way) and companies whine about processor pricing. Apple, meanwhile, has a revenue share significantly higher than its market penetration.

Next up, there's this "Windows 8 is a catastrophe for everybody in the PC space" bit. I don't like Windows 8's Desktop very much, but it's only a catastrophe for two kinds of users:  Seals...

and the Penguin from Batman Returns.

Whaddya mean, multi-finger support? What are you, racist?

If you're a the Penguin and trapped on a desert island with a Windows 8 tablet that requires a five-finger key-press to unlock it, you, my friend, have a serious catastrophe brewing. The seals will be fine once they remember they can swim and don't care about a Windows 8 tablet anyway because of fish.

FEESH. Your argument is invalid.

Now, just for the record, I think Gabe's stated goal of supporting Linux by bringing more great games to the OS is a capital idea. I admire the fortitude of any man who would step into an arena dominated by a would-be Moses who might, at any moment, send you a long, rambling email punctuated with video footage of himself snacking on detritus [Not Safe For Humanity] found between his toes.

When it comes to gaming -- actually playing games on a PC -- Windows 8 doesn't change anything. In fact, one could argue that its universal adoption of hardware acceleration at every level is the greatest vindication gamers could ask for. For years, 3D functionality was dismissed as something that only gamers cared about, even though the same cards that offered superior 3D often gave better 2D and video image quality as well.

If there was ever a Windows that threatened gaming it was Vista, though that was Nvidia's fault, not Microsoft. Documents that were unsealed as part of the "Vista Capable" lawsuit from years back illustrated this point vividly; Nvidia's Vista drivers were responsible for a whopping 28.8% of logged Vista crashes in 2007. That's not "All DX10 crashes" or "All gaming crashes." That's all crashes. Period. Since Nvidia cards were whomping all over AMD's during the 2006-2007 time frame, it's safe to conclude that Nvidia could scarcely have done more to hurt PC gaming if it'd been underwriting the legal "career" of Jack Thompson.

And yet somehow, PC gaming survived.

With all due respect to Mr. Newell, his company, and their awesome skill with pixels, Windows 8 won't stir PC gaming one iota. It won't kill the OEMs -- they killed themselves through persistent pursuit of cost-cutting at the expense of innovation. Metro may annoy a lot of people, but my games will play the same with it or without it -- and that's what I care about.

Now, if you re-skin Half-Life to turn all the guns into walkie-talkies, then we might have to talk. Otherwise, gaming is in safe hands.