Six Years of Valve Index: The Rise and Fall of the Popular PC VR Headset

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When Valve announced the Valve Index in spring 2019, it was clear: this wasn't just another VR headset to hit the market; it was meant to make a statement. The goal was a complete system for demanding PC users, developed by a company primarily known for its game franchises like “Half-Life” and the Steam platform. The Index was Valve's first VR headset designed entirely in-house; hardware, software, and accessories were intended to be perfectly harmonized. Six years later, at the end of 2025, Valve ceased production. The reason: the market had fundamentally changed and was facing a massive upheaval.

Ambitious Research and a Decentralized VR Plan

Valve laid the foundation for the Index back in the early 2010s when id Software's Michael Abrash, now Chief Scientist at Meta's Reality Labs, joined the company and advanced VR/AR research. At the time, Valve was experimenting with spatial tracking, display solutions, and new forms of interaction. An early breakthrough was the “Valve Room” project, a test lab with marker walls where developers could first walk freely in virtual space. The technology not only convinced internally: External developers like Alan Yates, who would later be primarily responsible for Valve's “Lighthouse,” or author and designer Chet Faliszek, who played a key role in the storylines of “Portal” and “Half-Life: Alyx,” were also persuaded to switch to Valve by these early demos.

Initially, Valve appeared in public as a technology partner for other manufacturers, approaching VR from the outset in an open and cooperative manner. Instead of keeping its research findings secret, Valve actively shared its insights with other companies. The Steam operator entered into a close partnership with the startup “Oculus,” which, thanks to an immensely successful Kickstarter campaign and the media-savvy support of development icon John Carmack, was on the verge of making VR socially acceptable again. Valve was convinced that the advancement of the entire VR ecosystem would ultimately benefit everyone in the industry.

Facebook Joins In

However, the Übernahme von Oculus durch den damaligen Facebook-Konzern im Jahr 2014 (takeover of Oculus by the then Facebook company in 2014) abruptly ended the close collaboration with the startup founded by VR wunderkind Palmer Luckey. Three days after the Oculus deal, Facebook also acquired Michael Abrash, making him “Chief Scientist” alongside Luckey and Carmack. Overnight, some of the most important minds in VR research at the time moved to Menlo Park, California.

However, Valve did not want to leave the VR market solely to Facebook and decided in 2015 to enter hardware manufacturing after all. The new technology partner was to be the Taiwanese tech company HTC, then primarily known as a smartphone provider. In 2016, the two partners finally launched the HTC Vive on the market. The Vive was the first VR headset to use Valve's external “Lighthouse” tracking system, which emerged from the Valve Room research project. The primarily used VR platform “SteamVR” was also largely based on Valve's work.

But the collaboration was anything but smooth. HTC allegedly bungled the launch, made unauthorized statements in Valve's name, and, contrary to original agreements, sold Vive products with an unnecessarily high margin. While the two companies continued their collaboration, Valve soon grew the desire to develop its own system – with control over every aspect: from optics and audio to controllers. In 2017, the decision was made to develop a VR headset codenamed “Index.” Target audience: experienced users with high demands.

Technical Ambitions and Development Work

The development of the index was characterized by high requirements. Many of these came directly from Valve's own VR game studio, which was simultaneously working on “Half-Life: Alyx.” The headset was intended to offer the largest possible field of view, high frame rates, and precise tracking. To achieve this, Valve developed a dual-lens system with angled displays, allowing a field of view of up to 130 degrees – about a fifth more than most competing products at the time. Two LCDs with 1440 × 1600 pixels per eye and frame rates up to 144 Hz ensured sharp, fluid visuals.

For the audio system, Valve opted for an unusual design: so-called “off-ear” speakers that float a short distance from the ear. They delivered spatial sound without touching the ear, increasing comfort during long sessions. Valve also prioritized ergonomics in headset weight (809 g) and fit. Padding, an IPD slider, and a finely adjustable headband were intended to make the headset suitable for as many head shapes as possible.

Particular attention was paid to the controllers. The so-called “Knuckles” (officially: “Valve Index Controllers”) were equipped with 87 sensors and captured every finger movement individually. Thanks to wrist straps, players could open their hands completely without dropping the controller. This precise finger tracking enabled new forms of interaction, such as realistic object grabbing or gesture recognition.

Production Start and Initial Hurdles

Sales began in June 2019. The full set variant – headset, controllers, and two base stations – cost $999. A high price, but the launch was successful: demand exceeded supply, and delivery bottlenecks soon occurred. In the months following its release, the Index was sold out in many regions.

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“Half-Life: Alyx,” developed exclusively by Valve for PC VR, was released in early summer 2020, but the wait was worth it. Alyx served as a technological benchmark for the system and is still considered the best VR game of all time. The combination of powerful hardware and high-quality software made the Index the preferred platform for many enthusiasts. However, Valve has yet to deliver another premium VR title.

The Standalone Era Begins

Almost simultaneously with the Index, other headsets appeared, such as Meta's last PC VR attempt, the Oculus Rift S, or the HTC Vive Pro. While Valve relied on external base stations, competitors already offered inside-out tracking with integrated cameras – a much easier system to set up but less precise at the time. Starting in 2019, Meta (then still Facebook) pursued a different strategy with the acquired VR brand “Oculus”: instead of focusing on expensive PC VR systems, they concentrated on standalone devices and established the standalone series “Oculus Quest” (now “Meta Quest”). These headsets no longer required a PC or cables, which was particularly well-received by newcomers.

With the release of the Quest 2 in 2020, the market balance of power definitively shifted – partly because Meta heavily subsidized its products, making them available at an unrealistically low market price. Furthermore, the Quest 2 benefited enormously from global lockdowns during the pandemic and the resulting increased demand for entertainment products. Meta sold around 20 million devices – a seemingly successful outcome, as we know today – while PC VR remained in the niche segment.

HTC could not compete with Meta's price dumping and increasingly focused on enterprise solutions. Valve, on the other hand, stuck with the Index – also because it remained unrivaled in its segment for a long time due to Meta's standalone strategy. Well into the 2020s, it was considered the benchmark among enthusiasts for high image quality, precise tracking, and ergonomic controllers. However, Valve failed to give the Index a much-needed technical upgrade or to meet users' demand for new software.

The Index Falls Behind the Times

Over time, the limitations of the Index became apparent. The resolution remained at 1440 × 1600 pixels per eye, while new headsets like the Meta Quest 3 or Sony's PSVR 2 worked with over 2000 pixels per eye. The Index's Fresnel lenses also appeared increasingly outdated compared to newer pancake optics. They were heavier, bulkier, and showed stronger light reflections. Furthermore, features like eye-tracking, color passthrough for mixed reality, or standalone use were missing.

While the Index continued to offer a decent PC VR experience, it fell behind the competition, especially in terms of everyday usability: setting up external sensors was cumbersome, a powerful computer was mandatory, and wireless use was only possible via third-party solutions. In addition, there were problems like stick drift on the controllers or cable defects after prolonged use. Despite all this, the Index maintained a stable user base until 2025 – especially among VR fans with a high affinity for hardware.

Transition to the Next Generation: Steam Frame

For years, rumors of a successor to the Index persisted. At the end of 2025, Valve finally unveiled a new VR headset: Steam Frame. The company announced the end of the Valve Index practically in passing. The Steam Frame marks a clear break from the previous concept: instead of a wired PC VR headset, Valve is now relying on a hybrid system with an integrated computing unit and wireless PC streaming.

The tracking technology now also relies on the significantly more precise inside-out cameras instead of the Lighthouse base stations, which are no longer supported at all. Instead of Fresnel lenses, compact pancake lenses are used, and eye-tracking is also integrated – for foveated rendering, among other things.

The Steam Frame is significantly lighter (440 g complete), modular, and aimed at users who want flexibility in VR. This change also reflects a shift in the market: the focus today is on mobility, simplicity, and wireless freedom. The Index, once hailed as a technical masterpiece, no longer fits into this new VR world with its stationary setup and complexity.

A Legacy with Impact

The Valve Index was never a mass-market product, but it left its mark. It set new standards for image quality, audio, interaction, and comfort in the PC VR sector. Many of its concepts, such as off-ear audio or precise finger tracking, influenced later hardware developments. Even though it is technically outdated today, it remains in memory as a highlight of the first major VR generation. With the Steam Frame, Valve is now taking a different path – not as a departure from the Index, but as a logical evolution.

The future belongs to flexible, autonomous headsets with optional PC connectivity. But without the experience gained with the Index, this step would hardly have been possible. The Valve Index thus marks not only an end but also the transition to a new phase of virtual reality. And who knows, perhaps Valve will even become the new beacon for a VR gaming industry that has become leaderless due to Meta's withdrawal.

(joe)