A new battle for dominance of the lucrative games console market is looming after US company Valve unveiled a device to rival the hugely popular Nintendo Switch.

Valve, which owns gaming platform Steam, announced Thursday that it will start shipping its Steam Deck console in December with prices starting at $399. The company boasted that the console, marketed as a hand-held PC, will give users "the most gaming power you have ever held" while allowing them to do everything they might otherwise do on a computer.

With its large seven-inch touch screen and high-performing processor, the Steam Deck has drawn instant comparisons with the Nintendo Switch, which has sold more than 80 million units since 2017.

Valve is the studio behind hit games including Half-Life, Counter-Strike and Dota 2.It was also a pioneer in terms of offering a catalogue of titles online, with its Steam platform the dominant player in the PC games market. The Steam Deck marks a fresh attempt by the company to enter the console market after the failure of its Steam Machine, released in 2015.

This time, in offering a device that can play all games designed for both Steam and Windows, Valve could present stiff competition to Sony's PlayStation 5 and Microsoft's Xbox Series X -- at a lower price.

"One of the things we're testing on this is that price performance can be one of the critical factors in the mobile space and so we've had to be very aggressive in terms of pricing on the deck," Valve chief Gabe Newell told gaming news site IGN. Video games analyst Laurent Michaud described the Steam Deck as "a very good surprise". "Nintendo has its first direct competitor, with a phenomenal catalogue," he told AFP.

But he noted that not all of the games available have been developed with a hand-held console in mind. Daniel Ahmad, a London-based senior analyst at gaming consultancy Niko Partners, said that Valve's "aggressive pricing, premium spec and a large library of games makes it a strong entry on paper".

Handheld gaming PCs have until now been a relatively niche product, he pointed out, but Valve's huge games catalogue makes it "much better positioned than others to enter this market". "While the Nintendo Switch has built up a library of over 5,000 games in the past four years, the Steam Deck will have a minimum of 8,000 games available at launch" because of its Steam operating system, "which includes popular games, not on Switch", he said.

The Steam Deck will start shipping to the United States, Canada, the European Union, and the United Kingdom in December, with  "more regions coming in 2022", according to its website.