What is it?

Valve Steam - steam.exe

What does it do?

Steam.exe is the main executable for Valve Software's Steam Powered content streaming application. Steam?distributes games and?content such as Half Life 2 and its addons like Counter Strike?using an online?streaming method. Whilst many would argue it is not the best software ever made, it is by no means harmful ;)

Virus Precations

Files associated with popular games tend to be targets, although at this point in time no such virus seems to exist that targets steam.exe or distributes itself as?steam.exe. This Google search should keep you up to date in case one does surface though.