Analysts warn PS6 and next-gen Xbox prices could go higher than Steam Machine

Valve finally revealed the pricing of its long-awaited Steam Machine earlier this week, with the compact SteamOS-powered living room PC priced at $1,049 for the 512GB base model and $1,349 for the 2TB version, or $1,428 when bundled with the new Steam Controller. Reservations for the Steam Machine have opened via a randomized queue system, with first-purchase emails expected to go out on June 29. Valve has been upfront, stating that the prior $750 target price is “no longer viable” because of higher memory and storage costs.

From a consumer perspective, the Steam Machine is roughly twice as expensive as many mainstream living room consoles. Despite this, industry analysts who spoke with GamesIndustry.biz were relieved that the price didn’t climb higher than their predictions. Mat Piscatella of Circana said, “I was thinking it would be higher, given everything. This seems like quite a reasonable price, all things considered.”

Meanwhile, Newzoo’s Emmanuel Manu Rosier said that the $1,049 entry fee “tracks the current component market, rather than any positioning choice. Valve set the 512GB model at $1,049, just above a clean $999.

Combined with its public line that the original target is ‘no longer viable,’ that points to minimal-margin pricing, not a marketing number.” Aldora CEO Joost van Dreunen wasn’t surprised, as he had already predicted months earlier that the Steam Machine could cost around $1,000.

The end of the subsidized console era or just a hiccup?

Other analysts described the price point as disappointing for consumer accessibility. For now, the consensus is that this is less a Valve-specific issue than an industry-wide problem fueled by surging DRAM and NAND prices, with demand from AI companies adding pressure to the memory market.

Furthermore, Valve does not appear to be subsidizing the Steam Machine as Sony and Microsoft have sometimes done with console hardware, so the sticker price more directly reflects the current state of the component market.

That pressure is also showing up around current consoles, though not always as straightforward official MSRP increases. PlayStation 5 and Xbox Series X prices vary by model, region, retailer, and bundle, while higher prices seen online can reflect markups or package deals rather than platform-holder price hikes.

Nintendo, meanwhile, has confirmed an $50 price tag increase for the Nintendo Switch 2, starting September 1, 2026, indicating that it too, despite much more modest hardware under the hood, is not immune to a memory and storage crunch.

With that said, the outlook for the next generation of consoles, including Sony’s eventual PlayStation 6 and Microsoft’s reported Xbox Project Helix, looks more expensive than past cycles. Analysts expect upcoming hardware to face a higher price floor if component costs remain elevated. Van Dreunen warned that “at this rate, the next generation may not even release until 2028, and when it does, north of a grand is the floor.”

Project Helix is already being discussed as a device that may require new business models and hardware partners just to reach store shelves at a consumer-friendly price. Rosier believes next-generation base-model consoles will likely remain subsidized and priced below $999 to preserve a relatively accessible entry point for early adopters.

Harding-Rolls noted that Sony and Microsoft have the relationships, infrastructure, and supply chain networks to offset hardware costs through software and subscription revenue in a way Valve may not. Even then, the two major console platform holders are unlikely to entirely escape the pressure of the component-cost crunch.