Too many people here don't seem to have any clue what's going on with Steam, so I plan to try and enlighten you. I'm sorry if someone else already explained it properly, because I got too frustrated at people not understanding to read all the posts.

Steam is a free service from Valve. You can download it and us the instant messaging service (Friends) or play some simple games like checkers. If you already own any version of Half-Life 1 or Counter-Strike retail, you can input that cd-key to have access to Half-Life and all mods through Steam.

The WON cd key servers will be shut down and no longer allow old versions of Half-Life or Counter-Strike to be played online. You do not have to upgrade if you only wish to play single player or LANs with other people who also want to use the old version, just like previous upgrades.

Because the WONID system is being shut down, when you put your HL/CS cd key into Steam, it will generate a new SteamID to replace the WONID. This has the adverse side effect of removing all the previous WONID-based bans, which should make server admins very busy for a few weeks while the grief players run around getting themselves banned again.

The initial HL patch that integrates Steam will have a converter to convert your content (pak files, maps, models, etc.) into the "cache" system it uses. In the future, when you format or wish to install HL on a new computer, you will have the option of either installing from the CD and then upgrading in the traditional manner, or simply downloading the Steam client and getting all of the content on-demand as you connect to servers. The upside of this is that, for example, if you never play HL single player anymore, you don't have to have the single player content on your computer, thus saving disk space. The same applies to TFC, DMC, and that stupid tron-like game.

An interesting aspect of Steam, is that your cd key becomes your proof of ownership, and is attached to your login permanently. This means that you should never get "cd key in use" from someone stealing your cd key, because Steam won't allow them to associate their login with a cd key that is already associated with a login. Also, you can install Steam on any computer in the world and have access to your right to play Half-Life simply by using your personal login.

Now for some speculation on Half-Life 2:
Valve has stated that in the store there will be 3 versions available: single player only, single + multi, and some sort of collectors edition. I assume that if you buy the single player component, it will still be Steam integrated for single player patches, and that you will also be able to "upgrade" to the multiplayer version by paying a small fee through Steam.

They have also stated that Half-Life 2 will be availabe through Steam in addition to the store, for a lower price, but without the box, cd, and manual, obviously. I think you will be able to buy either single or multi + single through Steam, with single being cheaper, and still having the option to upgrade to multi.

Now, about the "pay for play" thing. I'm fairly certain that this is an OPTIONAL way to buy future games. For example: You alredy own HL1, and want to try Condition Zero and HL2, so you pay $9.95 and you can play both all you want for one month, but at the end of that month you can no longer play CZ or HL2, but you can still play HL1 because you bought that game. Also, if during that month Team Fortress 2 is released, you would be able to play it during that month. For people who only want to play HL2 or CZ single player once, this can be a much cheaper method if they can finish it within that month.

Now I'm not sure how it will work if you don't have an internet connection or wish to play on a closed LAN. Valve haven't made it very clear. I assume there will be some way to download the entire cache for games you have bought (as opposed to have access to through the subscription program) to play them offline or on a LAN. If someone on the LAN doesn't have an item in their cache it probably defaults to downloading it from the server the old fashioned way (as opposed to trying to connect to a content provider). I'm sure this will all be made clear by the time the patch is out.

Basic info: Steam is a combination programs and services, which are also integrated into the game. It includes a server browser, instant messaging service, content delivery service, and front end for launching the games and managing which games you own. The IM client, called Friends works within HL (and i assume future games) and with the server browser enabling you to find and talk to your friends in other servers or outside the game. The content delivery service is what downloads things to your client, and enables you to buy a game online and download it through steam to play it, without ever having a cd.

This comment was edited on Sep 8, 12:01.