The future?
Let's start this off by just saying this: I'm no PC gamer. I've never built a rig. The pinnacle of my PC gaming prowess is playing Civ 5 on my Macbook Pro. I am not of the PC gamer legion. However, with Valve's recent announcements regarding PC gaming and the direction they mean to take it in (away from Windows), I find myself more and more intrigued.
To be clear, there is no single "Steam Machine". What Valve is doing is essentially converting their Steam platform into a Linux-based operating system (SteamOS) that can run in place or along side of Windows on PCs. Concurrently, they are working with OEMs (Original Equipment Manufacturers), to allow those companies the ability to build their own hardware with SteamOS baked right in (in place of Windows). The easiest comparison to make is Google's approach with Android; they let everyone use their OS and then partner with a specific companies to give a "pure" version with their newest firmware, with the OEMs' newest hardware. The (theoretical) result of Valve's partnerships are dedicated gaming PCs with no memory overhead to run the litany of tasks that typically run in the background with a similarly spec'd Windows PC. The SteamOS is the only thing installed on the computer, therefore the performance is optimized for Steam functions (i.e. gaming). These are the actual Steam Machines.
They won't stop staring at me.
My enthusiasm for this new platform is ironically buoyed from my experience with video game consoles. Essentially, the current-gen consoles ARE dedicated gaming PCs, with a common specifications list and pared-down OS. Combine this, with the ability to upgrade the actual hardware (graphics cards, hard drives, ram, etc.), and have access to the Valve (Steam) store versus Sony's or Microsofts, all the while playing in the living room (ala consoles) - and the appeal of Valve's platform is apparent. Plus, to have the access to PC-only games or the better performing version of a game (PC>Consoles) is enthralling as well. The SteamOS/Steam Machine endeavor simplifies the barrier of entry into PC gaming, strips the non-essential parts for current PC gamers as well as greatly expanding PC gaming's appeal to gamers who play on their televisions versus their monitors. However, it's not all rainbows and butterflies - to start out there are serious caveats.
Fragmentation, price and linux-based gaming compatibility are the proverbial rain on my Steam-machine-loving-parade. Again like Google, countless combinations of firmware and hardware bodes ill for mass compatibility among all Steam titles. Because of the customizable hardware/specifications of your Steam Machine, there won't be a guarantee that all games work or work properly from the Steam store (as opposed to consoles where you have a PS3 and ALL PS3 games work and work properly on your hardware). Adding to the compatibility headache is the current state of linux-based gaming - there's not much going on. Games typically aren't developed with Linux in mind and without a significant push from Valve, this probably won't change. And finally, the pricing is very much in the air. Valve has mentioned a "Good, Better, Best" mechanic/rating system of hardware configurations. The "Best" configuration, while not confirmed, has been alluded by many to costing between $1000-$2000. This prices the top-tier Steam Machines well above next-gen consoles ($399-$499) and therefore limits the expanded appeal to the television-gamers mentioned above.
Where are ze' buttons?
Time will tell what the SteamOS/Steam Machine platform encompasses and accomplishes. Many, myself included, would say this is more so a play at Microsoft's current monopoly of PC-based gaming and that this is meant to galvanize PC-users more so than enrapture console-enthusiasts. But that said, because Valve's record of consumer-friendly policies has been so spot-on and because they've lowered the barrier to entry into PC-gaming - there is a lot of opportunity for enhanced competition, more innovative thinking from all platforms (consoles included) and that gamers of all sorts will take notice and be excited. The possibilities of how all this will shake out, are all invigorating for the industry as a whole. Who doesn't want another way to play?
@techandjunk
The time is now?
Come to papa. 
Justified.
Bewitched.