My personal opinion is that the frame is a bit of a Trojan horse for widening the hardware they can run games (via Steam) on. With folks playing more and more indie and lower power requirement games, the rise of retroid pockets and Android gaming in general has taken off, and initiatives like gamehub lite have made it possible to run even Skyrim on these low power handhelds.
On the same token, the amount of performance per watt that Apple has been able to get out of custom arm based silicon is astounding. Valve has said they wouldn’t release another steam deck unless it represented a generational leap. That sort of leap would be something like the intel —> m1 that Apple produced.
What’s most exciting for me, is better steam support on multiple architectures. I think what’s most exciting for Valve, is their software and storefront running on more devices and providing a better experience than ever before. From VR to the deck to the desktop to the living room, I think their strategy at this point is pretty clear.
I don’t think it’s actually true that in low spec ranges AMD and Intel are competitive. The Apple a19 pro chip has a tdp of 8w while a Z1 extreme from amd has a 15w envelop that goes up to 30w. The A19 crushes the Z1 in single core and is 90idh percent on multi core. The fp32 performance is double the z1 as some indication of gpu horsepower. So let’s just say near the same performance at less than half the tdp. Or another way, same steam deck performance you’ve had (well better actually, steam deck doesn’t have a z1 extreme) at twice the battery life. The A19 Pro is also in a passively cooled device where a Z1 Extreme is actively cooled. Data sources for this: just looking at geekbench and pass mark scores that I could find. Of course there’s instruction translation overhead, and it’s not as clear cut as this (for one, Valve is not likely to poach chip designers from Apple and they seem reticent to create their own hardware), but still a thought worth considering.
Ultimately I don’t care if it’s arm based, I care about the performance of the machine itself (in totality, which the steam deck excels at even still).
So I guess in a long winded way, I’m agreeing with you that they should maximize the performance up to 15w (I would have said 30w for docked access but the steam machine seems to be their goal for the living room). I guess I am just not super convinced legacy chipmakers have what it takes to be competitive, even with a FEX penalty. I think we won’t see a steam deck 2 for another 2 years, and that’s a long time for FEX to mature, drivers to mature, and Valve to line up a low power, extremely strong device.