Nintendo Co. Ltd. struck the first blow in what is set to be an all-out war with Sony Corp. for the lucrative handheld game console market, aggressively pricing its new dual-screen model at $149.99 and setting its U.S. launch date for Nov. 21.
For its part, Sony kept mum on the price and exact launch date of its long-awaited PlayStation Portable (PSP), but also went on the offensive for the Christmas shopping season, saying it would release a smaller version of its PlayStation 2 console at $149 on Nov. 1.
In a bid to keep the dominance its GameBoy Advance machines have given it in the handheld market, Nintendo set the price for the “DS” dual-screen handheld console at the bottom end of analysts’ expectations.
“It was the lowest of my estimated price range,” said Takeshi Tajima, an analyst at BNP Paribas.
Following the U.S. launch, Nintendo, known for games characters such as Pokemon, Mario and Donkey Kong, plans to start selling the DS in Japan on Dec. 2 at 15,000 yen ($137), compared with 9,800 yen for the GameBoy Advance SP.
Kyoto-based Nintendo also raised its shipment forecast of the DS machine worldwide by the end of next March to around 4 million units from its May forecast of 3.5 million units.
Nintendo has had a virtual monopoly in handheld game devices, with about a 95 percent market share, but Sony is threatening to cut into its market with PSP, which promises advanced features such as a music and movie player.
Asked about Nintendo’s DS pricing, Sony Computer Entertainment (SCE) president Ken Kutaragi said: “We expect PSP to create a new market, helping expand the entire game market. But (direct competition is unlikely as) PSP and the DS will probably have different roles in the market.”
One of the Nintendo DS’s screens is touch-sensitive, and it can play games from the current GameBoy Advance series.
“There are no other handheld devices like it in the market. I see Nintendo extending their lead in handheld space,” said Hiroshi Kamide, analyst at KBC Securities.
Expanded market
Some analysts, however, expects Sony’s PSP, which is scheduled to be launched by the year-end in Japan and by March next year in the United States and Europe, to give Nintendo a run for its money.
“My simple prediction is that Sony will expand the market by about 1.5-fold by appealing to a different age group -- above 20 years old -- from Nintendo’s focus, which is young children,” said Takeshi Tajima, analyst at BNP Paribas.
“Then both Nintendo and Sony will each have half of the market.”
The announcement by Nintendo came an hour before Sony’s news conference.
Sony said it planned to sell the new version of PS2, which weighs half as much as the current PS2 and is a quarter of its size, in Europe for 149 euros ($181) also on Nov. 1, followed by a release in Japan on Nov. 3 with an open price.
Its regular PS2 is priced at around 20,000 yen ($182).
“We have seen a strong sales increase after PlayStation was remodelled into PSone. We expect the new model to help boost the game market,” Kutaragi, known as the father of the PlayStation, told a news conference.
Kutaragi’s comments were echoed by Electronic Arts Inc., the world’s largest video game publisher.
“With the PSone, the smaller shape worked very well. A similar move with PS2 is smart,” said Gerhard Florin, European head of publishing for EA.
“In this industry, you need to broaden the offering; it’s not a one-size-fits-all market.”
Kutaragi said the next-generation PlayStation console, tentatively called PlayStation 3 by some, will support Blu-ray technology, giving a boost to a group of electronics and PC makers promoting it as a next-generation DVD format.
Blu-ray technology, promoted by Matsushita Electric Industrial Co. Ltd. and Sony itself, competes with another DVD format called HD DVD, whose proponents include Toshiba Corp. and NEC Corp.