IPT generates a new six-digit password every 30 seconds and that code is used in conjunction with your standard credentials to provide another layer of security -- not unlike Blizzard's Battle.net Authenticator, which is widely used among WoW players. Sandy Bridge owners will be able to link their Steam account to a specific PC and will be notified if any unauthorized PCs attempt to gain entry.
"We expect to see widespread adoption of hardware-based security like Intel IPT by other service providers," said Doug Lombardi, Valve's Vice President of Marketing. "If as a customer you are buying movies, music, games, or digital goods, you want to know that they are more secure than your physical goods." Steam Guard is available to third parties to use in their software via Steamworks.