Rumors had been going around signaling that Valve might have enter the console gaming fray with some sort of Steam console product. That has been all slapped down now at least for the foreseeable future here. I never undersood this rumor since Valve has spent so much time making Steam into a cross-platform software "app". What would they get into the hardware business for? There is a lot of money to be made selling games via Steam and starting a completely new business by manufacturing hardware (at a loss most likely) didn't make sense.
What I can see is Valve teaming up with a Sony Playstation, Microsoft Xbox, or Nintendo Wii, the latter two most likely as Valve and Microsoft share the east side of Seattle as their home. Nintendo has a presence in Redmond also but nothing like Microsoft's. Time will tell