The Steam platform holder wants to bring competition to next generation gaming hardware by unifying the home computer and console experience.
"I think, in general, that most customers and most developers are going to find that [it is] a better environment for them," Newell told Kotaku.
"They won't have to split the world into thinking about 'why are my friends in the living room, why are my video sources in the living room different from everyone else?' So, in a sense we hopefully are going to unify those environments."
Newell went on to say that Valve's hardware will not necessarily be open-platform because users can get this experience from a traditional PC.
"Our hardware will be a very controlled environment," he added. "If you want more flexibility, you can always buy a more general purpose PC. For people who want a more turnkey solution, that's what some people are really going to want for their living room."
Valve took its first step towards optimising Steam for the living room with the release of the Big Picture mode update, optimising the service for TV screens.
Watch a video introducing Steam's Big Picture mode below: