Continuation and evolution of the Steam Box
Upgradeable hardware would go along way to help the Steam Box not run out of steam, but the on-going business Valve would require to help it prosper is something very important to consider.
Microsoft and Sony ran multi-billion dollar loses on the launches of their next-generation consoles found in the Xbox 360 and PlayStation 3. Valve would have to have investor backing before they can throw a device out into the market. I'm guessing that Valve would have no problem securing financing considering their history of AAA+ titles and a no-compromise look on how they produce games.
Valve don't release second-rate games - they polish, polish, polish. If Valve wants their rumored Steam Box to not only compete with the next-gen Xbox and PlayStation, but beat it, they'll want to make sure it tailors to all users. This would mean incorporating Windows (in some form) onto the device, again, I'm predicting Windows 8 here, or a launch with Windows 7 and an upgrade to Windows 8. This would mean it would serve as a full PC, Internet device, media device, NAS, and everything in-between.
The life expectancy of this device would far outweigh anything Microsoft and Sony can throw at us with their next-gen consoles. Valve are great with their post-release support, and don't seem to want to rip off gamers with DLC. Team Fortress 2 became free-to-play last year, and with sequels to these games, including Left 4 Dead, Counter-Strike, and more, Valve would have no problems competing and staying relevant in an ever-changing market.
They could even start teaching the industry veterans on how to do things better, Valve is a privately owned company, they don't need to impress share holders, or constantly make more and more money for every new release of a game within a franchise for it to be financially viable to release. Valve takes their time, and with the Steam Box, they would be making mountains of money from games from other developers.
It's a win-win situation for Valve, it really is.
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