pricing

Why $700 could be a “death sentence” for the Steam Machine

console, gaming, microsoft, Nintendo, pricing, Sony, steam, steam machine, steamos, valve / Shannon Garcia / February 6, 2026

Bad news for Valve in particular?

On the surface, it might seem like every company making gaming hardware would be similarly affected by increasing component costs. In practice, though, analysts suggested that Valve might be in a uniquely bad position to absorb this ongoing market disruption.

Large console makers like Sony and Microsoft “can commit to tens of millions of orders, and have strong negotiating power,” Niko Partners analyst Daniel Ahmad pointed out. The Steam Machine, on the other hand, is “a niche product that cannot benefit in the same way when it comes to procurement,” meaning Valve has to shoulder higher component cost increases.

F-Squared’s Futter echoed that Valve is “not an enormous player in the hardware space, even with the Steam Deck’s success. So they likely don’t have the same kind of priority as a Nintendo, Sony, or Microsoft when it comes to suppliers.”

PlayStation 5 in horizontal orientation, compared to Xbox Series X in horizontal orientation — Sony and Microsoft might have an advantage when negotiating volume discounts with suppliers. Credit: Sam Machkovech

The size of the Steam Machine price adjustment also might depend on when Valve made its supply chain commitments. “It’s not clear when or if Valve locked in supply contracts for the Steam Machine, or if supply can be diverted from the Steam Deck for the new product,” Tech Insights analyst James Sanders noted. On the other hand, “Sony and Microsoft likely will have locked in more favorable component pricing before the current spike,” Van Dreunen said.

That said, some other aspects of the Steam Machine design could give Valve some greater pricing flexibility. Sanders noted that the Steam Machine’s smaller physical size could mean smaller packaging and reduced shipping costs for Valve. And selling the system primarily through direct sales via the web and Steam itself eliminates the usual retailer markups console makers have to take into account, he added.

“I think Valve was hoping for a much lower price and that the component issue would be short-term,” Cole said. “Obviously it is looking more like a long-term issue.”

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Questions swirl after Trump’s GLP-1 pricing deal announcement

While some may stand to gain access to the drugs under these categories, another factor in assessing the deal’s impact is that millions are expected to lose federal health coverage under the Trump administration’s “One Big Beautiful Bill Act.”

Unmatched prices

In addition to the deals for federal programs, the administration also announced new direct-to-consumer prices. Currently, people with a prescription can buy the most popular drugs, Wegovy and Zepbound, directly from Novo Nordisk and Eli Lilly, respectively, for $499 each. Under the new deal, Wegovy will be available for $350, as will Ozempic. And Zepbound will be available at “an average” of $346. While the prices are lower, the out-of-pocket costs are still likely to be more than most people would pay if they went through an insurance plan, and paying outside their insurance policies means that the payments won’t be counted toward out-of-pocket maximums and other tallies. Generally, experts expect that direct-to-consumer sales won’t play a significant role in lowering overall drug costs.

It remains unclear if Trump’s deal will have any effect on GLP-1 prices for those on commercial insurance plans.

Trump hailed the deals, calling them “most favored-nation pricing.” But even with the lower prices for some, Americans are still paying more than foreign counterparts. As Sen. Bernie Sanders (I-Vt.) noted last year, while Novo Nordisk set Ozempic’s list price at nearly $1,000 in the US and the new deal is as low as $245, the drug costs just $155 in Canada, $122 in Italy, $71 in France, and $59 in Germany. Wegovy, similarly, is $186 in Denmark, $137 in Germany, and $92 in the United Kingdom. Eli Lilly’s Mounjaro is $94 in Japan.

A study published last year in JAMA Network Open led by researchers at Yale University estimated that the manufacturing cost for this class of drugs is under $5 for a month’s supply.

The announcement also said that future GLP-1 drugs in pill form (rather than injections) from the two companies will be priced at $150. That price will be for federal programs and direct-to-consumer sales. While such pills are nearing the market, none are currently available or approved by the Food and Drug Administration. Given that they are not yet for sale, the cost savings from this deal are unknown.