Traditional handhelds in permanent decline says Rob Fahey from Gamesindustry.biz

m.i.s.

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Rob Fahey from Gamesindustry.biz comes out fairly square in the "dedicated handhelds in terminal decline" camp.

Some choice quotes.

The end of handheld? [note: registration required]

"There's absolutely no question that what has happened to the 3DS is, indeed, a huge failure for Nintendo. I'm being careful to say "for Nintendo" here, because it's important to retain some perspective; the 3DS has shipped close to 4.5 million units worldwide, which would be considered pretty good by many consumer device companies.

The 3DS is faring better than, for example, tablet devices based on Android, or phones using Windows Phone 7 - and as others have been swift to point out, the figures aren't actually that far away from those achieved by the original Nintendo DS after its launch.

Similar logic applies to comparisons with the original DS; that was Nintendo's first truly successful console in almost a decade, and when it arrived few people understood the appeal of the dual screen, touch-sensitive layout. 3DS, as its successor, should have enjoyed much more immediate success.

The reasons for the 3DS' disappointing performance don't really need a lot of explanation - anyone following the industry knows what the problems have been with the console. The price was much too high, comparable with a PlayStation 3 and far above the cost of the existing DS or an iPod Touch. Nintendo seems to have hoped that the 3DS would appeal to a core audience initially, with the DS staying on shelves for the mainstream audience. The low sales figures suggest that the company's core audience has also stayed away.

That might be down to the lack of software, or at least, the perceived lack of software. 3DS owners and publishers working on the console might raise their eyebrows when the platform is accused of lacking games - in my own view, at least, it's got one of the strongest early line-ups I've ever seen on a console - but the meme is more important than the reality. Again, Nintendo's abandonment by core fans doesn't help - and while titles like Starfox and Ocarina of Time are excellent, the console could have done with original games rather than remakes at this point in its lifespan.

Another area where perception is more important than reality is marketing, and this has been a complete and miserable failure for Nintendo on almost every count. The public simply isn't aware of the strengths of the 3DS, thanks to a marketing campaign which has tried to strongly emphasise the ties to the DS brand while also talking up the 3D capabilities of the system. As a consequence, many consumers are still under the impression that the 3DS is simply a DS with a 3D screen - these people aren't stupid or uninformed, they believe this because that's exactly what Nintendo has been telling them.

The 3DS also ends up with its only heavily promoted USP being a technology that consumers don't want, and which many actively resent.

In theory, all of those things could be fixed. You can cut the price - Nintendo already has. You can bolster your software line-up, and Nintendo's already on the way to do that. Even if you can't change the ill-conceived name, you can at least formulate a marketing campaign that promotes the console's other positives and downplays the 3D factor.

What you can't do, however, is make smartphones and tablets go away. I think the factors outlined above are probably the core reason for the failure of the 3DS to achieve the strong launch Nintendo had hoped for, but in the medium to long term, it's smartphones and tablets that will have the largest impact. Multifunction devices may not play games quite as well as dedicated devices (yet), but they play them well enough for most consumers - and have led many consumers to see handheld games as something that should be free or very inexpensive, casting huge doubt on the market for £30 software. Has the company done enough to save the 3DS? The answer, I think, is probably "yes - for now". At a much lower price point and with the software catalogue growing rapidly, with a better marketing campaign behind it and hopefully with the leeway for some good software bundles as we approach key sales periods this winter, I believe that the 3DS should have pretty decent sales in the vital fourth calendar quarter.

In the longer term, however, I believe that it's simply impossible for the 3DS to replicate the success of the DS. The audience that Nintendo won for itself with the DS hasn't stopped gaming, but they've discovered - as many other gamers have - that there's a lot of high quality entertainment to be had for much lower prices. Iwata may rail against the dangers - as he perceives them - of low-cost software on iOS style platforms, but the reality is that billions of dollars are being spent on iOS Apps, many of them games, and that clever companies are finding ways to fund even the development of pretty large-scale, high quality projects using new business models provided by smartphone platforms.

What does the difficulty faced by the 3DS mean for the wider console market, particularly the handheld market? Where does this leave PlayStation Vita?

Sony will be seriously worried by the early failures of the 3DS. For a start, it puts them in the uncomfortable position of launching a much more expensive product than their rival - and as has been proven time and time again in recent years, for most consumers, the argument that it's more powerful so it's worth the money just doesn't wash, especially with a handheld platform. It also creates a market expectation of failure for dedicated handheld devices, so Vita's launch will probably be dampened by consumers holding off a purchase in case it, too, ends up being heavily discounted a few months later.

More importantly, though, the blow Nintendo has taken with the 3DS is an illustration of the real strength and influence of iOS devices in the gaming space. That traditional handhelds would suffer from the rise of iOS, not just due to the incredible sales of Apple's devices but also due to the resulting sea-changes in business models and consumer expectations, has been long theorised. Now we have proof, and it's solid enough proof to have wiped a fifth off Nintendo's formerly soaring stock value.

Sony, at least, understands the outline of this problem, even if I'm not convinced that it's grasped the full scale of it just yet. The PlayStation Suite framework for Android is designed to give the company a leg-up in the mobile gaming space, and it's shown vastly more commitment to delivering low-cost, high-quality content on PSN than Nintendo has on services like the 3DS eShop or its predecessors, which are much more focused on squeezing value out of retro titles than on providing a marketplace for original content.

Yet the reality still remains the same - PlayStation Vita is going to launch at the same price point which sank the 3DS, and even if some of the factors around it look more positive (not least that the early adopter market still likes Sony, but regards Nintendo as having blotted its copybook badly in the past generation), it's still going to be competing with iOS devices sporting a huge game catalogue at vastly lower prices. That's a tough nut to crack, and I'm not sure Sony has really worked out how to crack it.

Handhelds are a trickier proposition. The reality is that they're not quite so hardcore a market - some core titles break through, such as the extraordinary Monster Hunter (which, I recently discovered, actually commonly features in personal ads on dating sites in Japan, such is its ubiquity), but where few Xbox or PS3 owners are going to be satisfied with a complete move to an iPad or a bunch of Facebook games and free-to-play MMOs, a pretty large proportion of DS and PSP owners would probably be perfectly happy playing on iPhones or Droids.

That transition is no longer hypothetical - the money being pumped through the iOS revenue system, contrasted with the failure of the 3DS to ring the tills at retail, is proof positive that it's already happening on a large scale. The only question is how big this factor is going to be. 3DS and PS Vita will, quite simply, never scale the heights of the previous generation of handhelds - but if Nintendo and Sony are fast, and clever, and more than a bit lucky, there's a good chance that they can carve out a viable, if smaller, market.

One thing is certain - dedicated handheld gaming devices are now in rapid decline, and barring an extraordinary technological advance, they're not going to come back. Birthed with the Game & Watch, this sector is going to end with the 3DS and Vita. All that remains to be seen is whether it ends with a whimper, or a bang."
 
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AbsoluteZero said:
I say this with no Hyperbole: If the portable games market one day ends up being only iOS, you can bet your ass that I'll be a permanent retro handheld gamer.
Yep

For as long as there are people like me who want something more than $1 efforts there will always be a market for traditional handhelds, big or small.

iOS can suck my titties
 

sixteen-bit

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AbsoluteZero said:
I say this with no Hyperbole: If the portable games market one day ends up being only iOS, you can bet your ass that I'll be a permanent retro handheld gamer.
I think I'm already a retro handheld gamer. Dat monochrome.
Handheld gaming luddites unite!
 

FoneBone

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Some good points, but sloppy argument. He acknowledges that smartphones and tablet are not the "core reason" for the 3DS' failures so far, but then states only a few paragraphs later that "the blow Nintendo has taken with the 3DS is an illustration of the real strength and influence of iOS devices in the gaming space"?
 

Cheech

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AbsoluteZero said:
I say this with no Hyperbole: If the portable games market one day ends up being only iOS, you can bet your ass that I'll be a permanent retro handheld gamer.
You're looking at it the wrong way. Dedicated handheld gaming devices WILL die, there is no question about that, but handheld gaming on iOS and Android will only get better. If Nintendo had put out an Android phone with physical game controls instead of that eye scorching firesale abomination, they would be selling boatloads. THAT is where the future is taking us. Normally I'd say the nGage was ahead of its time, but honestly it was just a brutally poor execution of that idea.
 

[Nintex]

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Cheech said:
You're looking at it the wrong way. Dedicated handheld gaming devices WILL die, there is no question about that, but handheld gaming on iOS and Android will only get better. If Nintendo had put out an Android phone with physical game controls instead of that eye scorching firesale abomination, they would be selling boatloads. THAT is where the future is taking us. Normally I'd say the nGage was ahead of its time, but honestly it was just a brutally poor execution of that idea.
I'm sure Iwata and friends regret dropping the handheld they were developing with Nokia at some point.
 
Jul 15, 2004
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I'm going to repost my exact response to this as it was in the other thread:

One thing is certain - dedicated handheld gaming devices are now in rapid decline, and barring an extraordinary technological advance, they're not going to come back. Birthed with the Game & Watch, this sector is going to end with the 3DS and Vita. All that remains to be seen is whether it ends with a whimper, or a bang.
Good god. Let me nail my colours to the mast here and throw caution to the wind: he's fucking wrong.

How people are coming to such grandoise conclusions is completely beyond me. This, based off of 4 months of sales of a mis-marketed, overpriced handheld launch. Its premature to the EXTREME.

I don't think I know a single person who games heavily who would do their bulk of handheld gaming on an IOS or Android device. I don't know all that many people actually who are glued to Angry Birds or even the likes of Farmville...

Over 200 million dedicated handheld devices were sold in the last generation (DS/PSP) - and that number is STILL rising. Going by those numbers, if the dedicated handheld market is dying, so is the home console market! It's just absolute nonsense to assume that these devices are going away. It's like the people who come to these conclusions have never actually tried to play a traditional game using the shitty touchscreen controls that smartphones and tablets provide. There are reasons people haven't leapt all over the 3DS so far, and why they might hold off on Vita too, but to suggest such a strong correlation to the rise of smartphones is pure supposition. The very worst cases of that supposition often whiff of putrescent iGadget fanboyism.

I fucking GUARANTEE that when there are great games on both platforms, they will both sell very well. Tens of millions, maybe over a hundred million (each!) by their end.
 

GJS

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Cheech said:
You're looking at it the wrong way. Dedicated handheld gaming devices WILL die, there is no question about that, but handheld gaming on iOS and Android will only get better. If Nintendo had put out an Android phone with physical game controls instead of that eye scorching firesale abomination, they would be selling boatloads. THAT is where the future is taking us. Normally I'd say the nGage was ahead of its time, but honestly it was just a brutally poor execution of that idea.
Yeah okay, it wouldn't be selling any better than it is now, it would probably sell worse because it is then competing even more so with all of the other smart phones out there.

If Nintendo brought out a android phone it would have to be near top range at the time of launch to stand a chance so you are looking at £500 for a sim free phone or a subsidised price plus a £20-40 a month contract. That isn't going to attract that many people in, especially not the people who already have smart phones on a contract.
 

theBishop

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There's no doubt that iOS is a formidable player in handheld gaming. But I don't see how you can draw any broad conclusions about "Traditional Handhelds" based on 3DS. The system launched with the poorest lineup in recent memory, and it's not set to improve until the end of the year.

Gamers still like to play games, and smartphones/tablets make crummy game systems. Maybe the traditional handheld market will never be bigger than GBA/DS, but it can still be a strong piece of the pie. And through network connectivity, it allows Nintendo and Sony to keep their customers connected outside the house. That's incredibly valuable.
 

bradido

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I think Nintendo's fast hardware upgrades might have something to do with this too. How many people will not buy a 1st generation Nintendo handheld? You KNOW a much, much better hardware upgrade is 8-10 months away.

This is my biggest reason for not getting a 3DS.
 
May 2, 2008
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radioheadrule83 said:
I'm going to repost my exact response to this as it was in the other thread:



Good god. Let me nail my colours to the mast here and throw caution to the wind: he's fucking wrong.

How people are coming to such grandoise conclusions is completely beyond me. This, based off of 4 months of sales of a mis-marketed, overpriced handheld launch. Its premature to the EXTREME.

I don't think I know a single person who games heavily who would do their bulk of handheld gaming on an IOS or Android device. I don't know all that many people actually who are glued to Angry Birds or even the likes of Farmville...

Over 200 million dedicated handheld devices were sold in the last generation (DS/PSP) - and that number is STILL rising. Going by those numbers, if the dedicated handheld market is dying, so is the home console market! It's just absolute nonsense to assume that these devices are going away. It's like the people who come to these conclusions have never actually tried to play a traditional game using the shitty touchscreen controls that smartphones and tablets provide. There are reasons people haven't leapt all over the 3DS so far, and why they might hold off on Vita too, but to suggest such a strong correlation to the rise of smartphones is pure supposition. The very worst cases of that supposition often whiff of putrescent iGadget fanboyism.

I fucking GUARANTEE that when there are great games on both platforms, they will both sell very well. Tens of millions, maybe over a hundred million (each!) by their end.
I agree completely.

And with that, I'm bailing out of this thread, before the Apple crowd come and push their agenda down everyone's throats.
 

rpmurphy

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My opinion is that it's rather difficult to distinguish from what have been Nintendo's mistakes in the launch of the 3DS (or the design of the system itself) and what are true shifts in the portable market. Four months in, particularly when the smartphone market is still in the growth phase and Vita has yet to be released, is probably too short of a time to say one way or the other about the health of the handheld market.
 

Duxxy3

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What i like is that he lists every reason why the 3DS didn't sell as well as it should have in the first 5-6 months and then goes on to blame the poor sales and the downfall of dedicated handhelds on iOS. In all of this he fails to mention DS sales in the US and handheld sales being on top in japan.
 

GJS

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bradido said:
I think Nintendo's fast hardware upgrades might have something to do with this too. How many people will not buy a 1st generation Nintendo handheld? You KNOW a much, much better hardware upgrade is 8-10 months away.

This is my biggest reason for not getting a 3DS.
There was 15 months between the Nintendo DS launch and the Nintendo DSL launch in JP and close to 19 months between them in America.

The DSi was launched 33 months after the DSL.
 

[Nintex]

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Suzzopher said:
That never happened.
http://www.joystiq.com/2010/08/13/report-nintendo-and-nokia-once-engaged-in-planning-a-console-to/

Not to mention that the geniuses started this whole vs. Apple war in the first place. At first it was: "Cell phone vendors will be very upset if they find out what we're planning for DS!" and nothing ever came of it.

Iwata then said this in 2007:
Iwata, "So, I cannot imagine that, in the future, a single portable device will be able to provide every need for all the daily issues people have, and I do not share a vision that DS has to be merged with cell phones in the future. Of course, we do not know how cell-phone technologies will evolve and what kind of business structure will emerge in the future. I cannot say with 100% assurance that Nintendo’s future will never intersect with that of the phone business. But as far as the structure of today’s phone business is concerned, Nintendo does not have much interest."
and then they moved on to say: "Apple is the new enemy!" while using the latest macbook for the presentation.

In hindsight those comments during all those shareholder meetings were pretty stupid. This is also why they're having such a hard time to adapt, like with the Genesis, PlayStation, Xbox and Kinect they never saw it coming.
 

theBishop

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Duxxy3 said:
Fuck apple. Fuck them up their closed system asses.
lolwut?

OpenPandora Defense Force in effect?

Traditional handheld systems are far more "closed" than any smartphone.
 

faridmon

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If dedicated Handheld dies, then I will only go retro as well, or stuck with console gaming/PC gaming. I can tolerate IOS/Android devices.
 

Father_Brain

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Counterpoints worth noting:

1. In the US alone, DSL/DSi systems sold nearly 400K units in June despite the lack of any significant software releases.
2. Pokemon B&W had, I believe, the highest debut sales of any Pokemon game to date.
3. The fact that iDevices are taking an increasingly large percentage of the handheld-game-sales pie means nothing unless the size of the pie is remaining constant. It's not a zero-sum game.

And as FoneBone notes, it's quite a logical leap from the majority of his article to the last two paragraphs.
 
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I'll take the plunge into mobile/phone gaming when:

They create a phone/pad with a comfortable and clever d-pad, dual analog, shoulder button, face button, grip frames
The games are as sophisticated as something like Uncharted or Diablo

That'd be good enough for me - I hope that the PSVita does well.
 

Famassu

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So now we've gone from predicting death of PC gaming to death of consoles AND handhelds?

Yeeeah...
 

Suzzopher

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[Nintex] said:
http://www.joystiq.com/2010/08/13/report-nintendo-and-nokia-once-engaged-in-planning-a-console-to/

Not to mention that the geniuses started this whole vs. Apple war in the first place. At first it was: "Cell phone vendors will be very upset if they find out what we're planning for DS!" and nothing ever came of it.

Iwata then said this in 2007:


and then they moved on to say: "Apple is the new enemy!" while using the latest macbook for the presentation.

In hindsight those comments during all those shareholder meetings were pretty stupid. This is also why they're having such a hard time to adapt, like with the Genesis, PlayStation, Xbox and Kinect they never saw it coming.
Trust me there is no way they were doing anything with Nokia.
 

Pureauthor

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*reads thread title*

Here we go again.

*reads article*

I hate being right about things like this.
 

[Nintex]

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Looking back at it all, Iwata really had no clue

http://gizmodo.com/5280410/nintendo-ceo-satoru-iwata-says-he-wouldnt-use-a-mac-or-iphone-if-apple-was-a-competitor
When Dean Takahashi asked about the potential threat of free games, Iwata responded, "Because of this?" as he pulled out his iPhone.

Talking about the overlap between it and the DSi, he said, "The features of the iPhone and the DSi may overlap. But if we look at our differences, the areas of overlap are small. If, in the future, this overlap becomes bigger to the extent we should call it direct competition, I have to be more careful. I can't bring out the iPhone during an interview anymore. Today, I don't worry about it."
 

The Technomancer

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AbsoluteZero said:
I say this with no Hyperbole: If the portable games market one day ends up being only iOS, you can bet your ass that I'll be a permanent retro handheld gamer.
Sad but true. iOS can be fun, but without dedicated inputs one of my favorite genres, the reflex-heavy platformer, would be dead on handhelds.
 

angelfly

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People are putting way too much faith in the future of smart phone gaming. Traditional handhelds are here to stay. Just because 3DS isn't living up to the DS you can't call it a decline of traditional handhelds especially when there several reasons to point at for it not performing.
 

ampere

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Cheech said:
You're looking at it the wrong way. Dedicated handheld gaming devices WILL die, there is no question about that, but handheld gaming on iOS and Android will only get better. If Nintendo had put out an Android phone with physical game controls instead of that eye scorching firesale abomination, they would be selling boatloads. THAT is where the future is taking us. Normally I'd say the nGage was ahead of its time, but honestly it was just a brutally poor execution of that idea.
We'll see a multi-function device with proper controls eventually.

I personally don't mind buying a dedicated handheld gaming system, but I can see why they're on a decline. My brother used to be all about Gameboy and DS, but now he just plays on his phone or iTouch.


_dementia said:
Everyone not named Apple
Apple is dying too, just a tad bit slower
 

The Technomancer

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Really? Say that in six months after the price drop and godamn Mario Kart have still failed to push 3DS numbers and maybe I'll agree. As others have pointed out we have no idea what effect iOS has on the 3DS because so many other factors kept it from selling well. The DS seems to still be doing fine.
 
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In the west yes. In japan these handhelds will continue to prosper. Handhelds are the only way to play good japanese games, and there are still some people out there that like that sort of thing, like me. I honestly cant wait to play japanese games again that are not bogged down by substandard hardware with shit controls.
 

rpmurphy

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And what about the Xperia Play? Wasn't that supposed to be the smartphone gaming device that was going to spark interest in high quality games with a proper gamepad? How is it selling compared to other big smartphones?
 

MikeE21286

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AbsoluteZero said:
I say this with no Hyperbole: If the portable games market one day ends up being only iOS, you can bet your ass that I'll be a permanent retro handheld gamer.
pretty much agree.

I'd love to see Vita add some type of capability to output to an HDTV in some way though.

I think that would definitely help its cause tremendously.
 

theBishop

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_dementia said:
Everyone not named Apple
Everyone including Apple:


Top 2 Android handset manufacturers Samsung and HTC exceed Apple's smartphone marketshare when taken together. Factor in SonyEricsson, Motorola, and the increasingly hungry LG, and Apple has significant reason to worry.

And as Android-powered tablets really ramp up, Apple will face stiff competition not only from smartphone manufacturers, but also laptop vendors like ASUS, Acer, Lenovo, etc.

It's 1995 all over again, and Google is Microsoft.
 

MightyKAC

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Wow, this is the second time I've it's been appropriate to post the latest Penny Arcade strip today.

 

[Nintex]

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The_Technomancer said:
Really? Say that in six months after the price drop and godamn Mario Kart have still failed to push 3DS numbers and maybe I'll agree. As others have pointed out we have no idea what effect iOS has on the 3DS because so many other factors kept it from selling well. The DS seems to still be doing fine.
I now kinda understand his reaction to this debacle a bit better. He told the same shareholders: "Online, pfft that'll never catch on!" , "Digital distribution... no I don't think that is the future" and "A cell phone that does everything? Not in my lifetime haha!", and Nintendo picked the least popular current market trend to sell their system with, 3D.
 

mr_chun

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Same thing people have been saying all year. He hardly brought any insight to the table.

I still say that the overlap of consumers looking for mobile devices that play games and consumers looking for handheld gaming systems is very small. They're not necessarily the same people. Most of the people that have invested in gaming systems generation after generation will continue to do so. Maybe we lose the casual market here, but Nintendo was pushing hundreds of millions of handheld units before the dawn of "mobile" gaming. That audience is still largely there, and ready to buy the new systems. Just not when they're sloppily marketed at an insane price compared to Nintendo's previous efforts.

Sony will be fine too- the jumped headfirst into the handheld market and snagged a third of the share, almost 70 million units. Pretty incredible. They'll both be fine. Pokemon and Monster Hunter will always be there to save the day, even if I'm wrong about the above.
 

Stumpokapow

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MightyKAC said:
Wow, this is the second time I've it's been appropriate to post the latest Penny Arcade strip today.
The neat thing about the strip is that people from both "camps", such as it were, can read the comic as vindicating their perspective.
 

SmokyDave

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Works for me. Why pay for a separate device that'll be outperformed within a product cycle or two anyway?

Not to mention the ridiculous price of games for dedicated handhelds.

I love the continuing myth that all iPhone games are 69p match-3 puzzle games.
 

SneakyStephan

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What a load of crap, 3ds was overpriced and hasn't gotten enough games yet, psp was poorly supported in the US (it does fine in europe and japan) and DS was a smash hit.

SO sick of these gold diggers trying to chase the next bubble as fast as possible, it's like the new wild west oil craze.

He says himself that there is a large audience for handhelds, but just because facebook and ios shit might be more profitable while everyone is rushing to get their piece of the pie it somehow isn't viable?

Which reminds me much of all the shovelware mmos as the market exploded and now pretty much every mmo either having to go f2p on a very very small scale to survive because the market is saturated.
Some new startups got rich, and a ton of people who tried to jump the bandwagon just ended up wasting a lot of time on a dead end venue.

If only the people in charge were able to look past their potential next quarterly figure.

Maybe when phones become more like handhelds they will become a threat (instead of just having it's own -massive- "niche" for different people).
But turning a phone into a handheld functionality wise would just make it a bulky phone that noone wants.
 

Red UFO

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I feel that while there is some overlap in the audiences of the DS and the iPhone, they are still very different, and one will not over-rule the other.
 

m.i.s.

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[Nintex] said:
I now kinda understand his reaction to this debacle a bit better. He told the same shareholders: "Online, pfft that'll never catch on!" , "Digital distribution... no I don't think that is the future" and "A cell phone that does everything? Not in my lifetime haha!", and Nintendo picked the least popular current market trend to sell their system with, 3D.
That's kind-of how I see it too. Nintendo's just too insular, too Japanese, holed up in a bubble in downtown Kyoto and missing vast trends that others just take for granted.
 

DaBuddaDa

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There is definitely a sizable market for dedicated handhelds, but the market that made the DS so large has definitely flown the coop and ain't coming back. This is why I think the Vita might actually be a solid success. It targets and might capture the market remaining in the dedicated portable space better than the 3DS.