Details are beginning to emerge that Valve may be working on their own gaming hardware platform. As you know Valve is an industry pioneer that beyond creating A-list games like Half-Life and Left 4 Dead, placed their bets on the now hugely popular game distribution service Steam. The rumors about a hardware console started to unravel when Gabe Newell, co-founder of the company spoke to Penny Arcade in a recent interview.

He was quoted as saying, “if we have to sell hardware we will,” which seems to have sparked a heightened interest in the firm’s future plans. Now according to the Verge, their sources have revealed that the game developer has been secretly working on gaming hardware for the living room.

In the same recent interview Newell also commented, "we’d rather hardware people that are good at manufacturing and distributing hardware do [hardware]. We think it's important enough that if that's what we end up having to do, then that's what we end up having to do."

Further evidence in the form of a patent filing by Valve last year adds to the speculation. The new “Steam Box” is likely to ship with a proprietary controller, possibly even allowing for swappable parts going by the details (below), as well as offering compatibility with a range of existing USB peripherals.

The release of the Alienware X51 could be yet another hint of things to come, as the dimensions would be ideal for making the “Steam Box” according to the Verge. They believe the firm has been working on hardware specs, which might include an i7 processor, 8GB RAM and an Nvidia GPU. If it becomes a reality, it will play standard PC titles, as well as allow rival gaming services like EA’s Origin to be installed and used.

Valve also announced at last year’s GDC their new Steam “big picture” mode, which consumers are still waiting to see released. In an announcement at the time, the game house touted, "with big picture mode, gaming opportunities for Steam partners and customers become possible via PCs and Macs on any TV or computer display in the house."

The potential new device may also be looking to take on set-top TV devices like the Apple TV, and not just compete with existing consoles like the Xbox 360 and PlayStation 3. In either case, we assume there would be a considerable price difference, and yet it proves the battle for dominance in the living room is merely beginning.

Secret meetings are said to have been held at this year’s Consumer Electronics Show, where Valve demonstrated a hand-built version to potential future partners. It is possible more news will follow at this week's Game Developers Conference, but it may not be until E3 later in the year that we get to find out exactly what Valve has been working on.