Sony and Microsoft Face the Third Platform

(Corrects how many units were shipped of Sony's PS/3 and Microsoft's Xbox.)

NEW YORK ( TheStreet) -- While everyone is talking about the launch of the Sony  ( SNE) PS/4 and Microsoft  ( MSFT) XBox 1, there's a third gaming platform drawing less attention.

It's your PC.

But if you think Microsoft owns the PC gaming market, think again. If you think that platform is stable, think twice.

The PC gaming market is basically owned by a private company, Valve Software, and its distribution product, Steam. Its market share is estimated at 75%, with 3,000 games running on it, and over 65 million Steam accounts. There are versions for the Mac OSX, for mobile platforms, and Linux.

This is competitive with the installed base of Sony's PS/3 and Microsoft's Xbox, both of which had shipped over 76 million units by the end of last year. Steam should be seen as the third force in gaming, alongside Nintendo's Wii and Wii-U, which is finally catching on in Japan.

Valve started as a game developer. Steam's competitors, Uplay from UbiSoft (EPA: UBI) and Origin from Electronic Arts ( EA), are also game developers. But Steam started accepting third-party games in 2005, when digital distribution was in its infancy, and has kept its lead.

This has given Valve immense power over gaming. You have to run Steam to run Steam games. When games finish they drop you back into Steam. If something happened to Steam or Valve, players fear they could lose access to games they've already bought.

Microsoft upset the Steam applecart a few years ago by announcing it would put its own game distribution network into Windows 8. This upset Valve CEO Gabe Newell very much. Had Windows 8 been a bigger success, this might be a bigger story, but Steam runs well under a Windows 7 compatibility mode in Windows 8, and most gamers I know have noticed little change.

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