Steam users can watch their friends play by clicking on "Watch Game" on their profile or via their Friend's list.
On the Steam Broadcasting page it states that both you and your friend need to opt into the Steam Client Beta.
To try out Broadcasting now, both you and your friends need to opt into the Steam Client Beta. In the Steam client main menu, select Settings > Account and change your "Beta Participation" to "Steam Beta Update".
You can head over to the Steam Broadcasting page for more information.
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Related Forum: PC Gaming Forum
"Steam Broadcasting now in beta" :: Login/Create an Account :: 40 comments