Valve's Steam Box concept allows other companies to creat their own Steam Boxes - such as Xi3's Piston revealed at CES. But Valve are also hard to on their own Steam Box and in an interview with the BBC - Valve's Gabe Newell revealed that they expect a prototype Steam Box within 3-4 months.
"We'll be giving out some prototypes to customers to gauge their reactions, I guess, in the next three to four months."
"There are noise issues and heat issues and being able to [deal with] that while still offering a powerful enough gaming experience is the challenge in building it."
Another issue is with controlls where Valve are experimenting with body sensors to allow for player reactions to influence the experience.