Terrell said:
Anyone getting the impression that Nintendo might be really worried about when the iPhone lands in Japan about now?
I see the iPhone possibly acting as a new, disruptive influence in handheld gaming but not displacing the older systems. It could be the handheld world's "Wii" up against the more traditional DS and PSP. I'm not claiming the iPhone will be as successful as Wii in dominating the gaming scene: that sounds remarkably unlikely. I mean it offers a revolution in thinking that may open up handheld gaming to new genres and markets, competing in a slightly different space than the others though ultimately chasing after the same limited supply of consumer entertainment dollars.
Wii provided innovation (motion control, one-hand control, pointing control all out of the box on the default interface) and casual-friendly packaging (Wii Sports pack-in, $250 price point) to upset the normal pecking order of home consoles. In exchange it has several important limitation: non-standard interface with fewer buttons and sticks, less on-board memory than the competition (mostly), only EDTV resolution and far less powerful rendering capabilities, and so forth.
iPhone gaming kinda mirrors this. It's definitely innovative: multi-touch control and tilt control on a handheld opens up new gaming options. It's a phone with extensive WiFi capabilities out of the box, trumping all the connectivity options on DS and PSP. And most important from the business perspective it will utilize a digital download sales model running on the most successful DD storefront in the world.
... BUT the downside is the device has only four buttons and a switch and none of them could be co-opted for use in-game, they're reserved for core device functionality. Like the Wiimote the device's interface innovation separates it from mainstream gaming design. Many types of games just will not work well without mechanical buttons and D-Pad providing tactile feedback and predictable response times. And the battery will be an issue, and the price is prohibitive for a mainstream gaming machine (of course, practically no one will buy it JUST for gaming).
iPhone and devices like it can revolutionize mobile gaming but it can't render the dedicated gaming hardware obsolete. But if I were in charge at Nintendo I would be keeping an eye on future iPhone hardware revisions and keeping the R&D guys working overtime...