Or Apple, or Google, or Amazon. Steam is, really, just an app store. And that's becoming part of the platform in the modern world.
Frankly I think the sanest option here would be for MS to simply buy Valve and turn them into the "Windows App Store". But I can't imagine that happening given all the internal churn that would be required to eliminate all their existing online purchase junk.
You are correct app stores are becoming standard OS components. I feel like Steam on linux is one step away from a SteamLinuxOS. Which opens up console ideas comprable to the Ouya Andriod powered console that was just buzzing on kickstarter.
Valve is not a public company so there is no shareholders nor investors who can pressure Gabe to sell. There is also absolutely no insensitive to sell for him. Even if he gets tired of Valve he can simply start a new venture by using the insane cash-flow raining directly in his bank account.
Because most companies hemorrage money. Valve was built after Gabe and the other co-founder got rich as hell from working on microsoft. They didn't need funding while valve was bleeding cash, so they don't have to do that.
I don't think they have too much to worry about. Will take a lot to get gamers to switch to a Microsoft app store. Granted Microsoft could probably eat away at the very casual end of gaming.
Gamers are (I think) attracted to Steam because of it's convenience and price. Many gamers will pass up games on alternative dd platforms because they can't get the game to register on steam.
If Microsoft provides competitive pricing, fast downloads and good key management (easy key activation, no PC activation limits, DRM-free options, good online/offline story) I could see people switching away from Steam.
Amazon is actually trying quite hard in this area - their download application could use work, but they have pricing and good DRM policies in place. Plus, their community outreach is mind boggling (especially considering the other DD outlets do none at all).
Microsoft would have to get the community features right too. Also perception, Valve are well liked by gamers whereas Microsoft would have to work really hard to build that up.
Can someone explain to me how the App Store model is a viable business model? It seems like, at some point, it just becomes a race to the bottom in terms of the cut of sales revenues, or an abusive oligopoly of stores that force burdening arbitrary rules and limitations down peoples' throats.
Frankly I think the sanest option here would be for MS to simply buy Valve and turn them into the "Windows App Store". But I can't imagine that happening given all the internal churn that would be required to eliminate all their existing online purchase junk.