He doesn't think Valve will be the only players in the game though. Newell expects other hardware providers to join in as well, selling PC's that connect to your TV and play Steam games right out of the box, and these PCs will be competing directly with consoles.
This is just speculation, but if Valve's own SteamBox runs Linux, this could give Linux quite a big gaming boost. At the very least, this could change the gaming landscape significantly. With Greenlight giving developers an easier way to get distributed, this could bring indie games to more players.
What do you think? Will this be a game-changer, or will it barely make a dent?
Kotaku's coverage: http://kotaku.com/5966860/gabe-newell-living-room-pcs-will-compete-with-next+gen-consoles