The Steam controller is a big part of what makes a Steam Machine a Steam Machine; we were told that running SteamOS and being packaged with the controller were two of the main things that need to be included to use that branding. The controller itself has gone through a number of revisions, but we were able to use what Valve is calling the final version during GDC.
It's a strange controller if you're used to the offerings on consoles. There are two touch pads, one on either side, that double as buttons. There are triggers, two bumpers, and two more buttons on the rear of the system on either side. That means that, ignoring the four face buttons, two touch pads and analog stick, there are six buttons on the rear of the controller.
It all makes sense when you hold it in your hand, and the controller does some interesting things to emulate the use of a mouse and keyboard. In the demo I played, the right touch pad emulated a track ball, complete with a sense of momentum; you could flick your thumb over the pad and "feel" the effect of a rolling ball along with a sense of weight to the movement. You can bring up an overlay in Steam at any point and adjust what the buttons do, how they act, and the level of the haptic feedback.
It's fully configurable, which is part of the point; we were told that one of the features of the system was the ability to come up with a novel control scheme and then share it online so others can use your settings.
The controller is coming this November, for $49.99. It felt great, and boasts some interesting and borderline strange features. It will take much more testing to see if it's a viable solution for PC gaming in front of the TV, but it's already closer than most other pieces of hardware that promise to provide the same thing.