"Imagine, instead, having four or five different manufacturers selling systems so diverse that the low-end ones may not even be able to support every game on Steam. Imagine also trying to explain that the Steam machine you buy today may not be sufficient to run demanding games that come out in two or three years."
you mean exactly how PCs have always been and yet PC games sell millions of copies? and how smartphones, tablets, e-readers, etc. are very similar and also selling quite well?
"Very few people want to hear that they need to already own a gaming-quality PC, ready to stream via Wi-Fi, if they want to access a good chunk of Steam's content."
you mean other than the millions of PC gamers who already have gaming rigs and wifi?
"Given that Steam was designed with PCs — inherently upgradable and in possession of a tech-savvy user base — in mind, targeting a user base that's more comfortable buying static machines could be a difficult proposition."
first, it's not that console users are somehow too inept to upgrade their consoles, it's that their consoles are incapable of being upgraded. they would upgrade if they could. second, a solid gaming rig can last a few years, and you can breathe new life into it with just one or two upgrades.
I'm sorry call you out, but Marshall Honorof, you are out of touch with reality. not only are your concerns baseless, but valve is a very shrewd business. I can guarantee they already covered this ground and did their homework before moving ahead with this plan.