Yeah this thing has my attention. In the absence of a "Switch Pro" with improved specs, this is really tempting for me. I already have a decent gaming desktop, and a gaming laptop, and a Switch...but I dunno, this is just reeeeeeally tempting. It would be so nice to play some of my favorite PC games on the go that haven't made it to Switch. And the experience with games that can play on both will be far superior on the Deck. They showcased Jedi Fallen Order specifically running on the Deck...that's one of my favorite games in recent memory, and to be able to play it on a handheld? Tempting, that's all I can say.
What's interesting about all of this is that this continues a growing trend of handheld PC gaming. There are already devices on the market like the GPD Win 3 and the Aya Neo. And Dell showcased a handheld gaming PC device at a tech show a year or two ago as I recall, though that has yet to come to market. And now a big player like Valve is looking to making a splash. I have a feeling that this isn't just a flash in the pan, but an emerging product category. I do think a big driver of this is the Switch. I think the Switch illustrated that there is a demand from older consumers for devices to play "AAA" games on the go. A handheld PC can fill that demand, and go a step further in the experience than the Switch does. No, I don't think these products really pose a threat to the Switch. They occupy a price category above the Switch sort of by necessity, they're always going to be a little more niche than Switch just like how gaming PCs are a little more niche than game consoles. But I think there's a chance for them to find that niche, to successfully coexist with the Switch like gaming PCs successfully coexist with game consoles.
Ok, now to talk about the specs a bit. A key takeaway is that this is running on the same tech as the new generation of consoles -- AMD's Zen 2 CPU architecture and RDNA 2 GPU architecture. Zen 2 is a couple years old now, but it's still pretty good, and RDNA 2 is AMD's latest and greatest (and was really well received vs Nvidia's Ampere, excepting ray tracing performance, which wouldn't really be a possibility in this performance class for either chipmaker anyways). Obviously it's much less powerful than what's in the new consoles, but it's the same basic tech. Compared to a couple similar devices, the Aya Neo and the GPD Win 3, there are pros and cons. Notably the Steam Deck has a 4 core, 8 thread CPU, while Aya Neo has a 6 core CPU (without hyperthreading). So the Aya Neo may have more CPU headroom. But the Neo's GPU is an older Radeon Vega architecture with 6 compute units (CUs), while the Deck is RDNA 2 with 8 compute units. So it will have
much better graphical power. The GPD Win 3 uses an Intel CPU and integrated graphics so it's harder to directly compare, but it may be in the same spot of having more CPU power but significantly less GPU power than the Deck. And on these devices I think they're going to run into a GPU bottleneck well before hitting a CPU bottleneck, so my money's on the Deck for being the better solution. Plus, the Deck uses faster LPDDR5 RAM rather than the LPDDR4 that the Win 3 and Neo have. That's a really big deal, and a big advantage the Deck is going to have over those devices.
One thing that needs to be said though is that the base model Deck is DOA. Only 64 GB of internal memory, and it's eMMC memory, which is slower than a standard SATA 3 SSD? Yuuuuuuck. Most modern games won't even fit on that. The mid tier model with a 256 GB NVMe SSD will be much better just from a performance perspective, though it's still only going to be able to install like three or four modern games at a time. And forget about installing modern games to a flipping micro SD card and expecting a decent experience. If I get this, I'm going for the full 512 GB model, and I think they probably should have made a 1 TB model.
Given how well Steam's last "console" did, I'd say they have nothing to be afraid of.
People could already connect their PC to their TVs (via a cable or streaming) and play their games on the big screen if they wanted. If they wanted to play on the go then they could stream their PC to their phone. And most people who buy the Switch aren't buying for the dual functionality; they're buying for access to the current library of Nintendo games.
If you mean "Steam Machines", Valve is handling this very differently. Steam Machines were supposed to be a console alternative...but Valve just opened the platform up to any hardware integrator that wanted to make something. The products ranged from $500 to $2000. There was no coherence, it was just PC gaming running SteamOS instead of Windows. This time, it's a specific device Valve is making themselves, with only three clearly differentiated SKUs. I think this stands a much better chance of succeeding than Steam Machines did.
And I've tried streaming games from my PC to my phone, using one of the very games Valve showcased on the Deck, Jedi Fallen Order. It was an unplayable mess.