Steam is the most popular game distribution platform for PCs. It was created by a company called Valve. People download the Steam software for their PCs and use it as a "portal" to purchase games which they then download. Think of it as an app-store for games.
Most people install Steam on their Windows PCs.
Recently, Valve has expressed a dissatisfaction with Microsoft. Valve's founder, Gabe Newell, was quoted as saying that Windows-8 was a "catastrophe". Aside from Windows-8 sucking badly, Valve and Microsoft now have conflicting app-stores with Microsoft now competing directly with Valve for game distribution.
Valve has taken upon itself to bypass Microsoft and develop a PC platform running linux and steam as a gaming-only device that you could use in your living room - similar to a console like an Xbox or Playstation.
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