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Adults the Target of Handheld Video-Game Systems (February 22, 2005)

The newest handheld systems from Nintendo and Sony (Nintendo,Sony/Jiji)
The competition for customers in the gaming industry stepped up a gear in late 2004, as two major makers of video-game systems engaged in a battle over the next generation of portable video-game systems. December 2 saw the debut of the Nintendo DS, which retails for ¥15,000 ($143 at ¥105 to the dollar), while the current leader in the game sector, Sony Computer Entertainment, released its first handheld platform on December 12, the PlayStation Portable (PSP), which costs ¥20,790 ($198). With sales of video-game consoles in Japan currently in the doldrums, the aim of these two companies is to develop a new fan base and win over adult consumers.

Sony vs. Nintendo
Nintendo has until now been the leader in the market for handheld game consoles, releasing the original Game Boy in 1989 and the Game Boy Advance in 2001, which between them sold some 47 million units in Japan. The Nintendo DS takes its name from the fact that it has a double screen; the top and bottom screens are both used as displays, and the bottom one also doubles as a touch panel that allows users to manipulate game characters by touching the screen with a pen. The idea is to bring the experience closer to the user, enticing people who have never played a handheld game to give it a try.

The PSP features a simple, lustrous design aimed at making it easier for adults to play video games outside in public without embarrassment. Equipped with a high-resolution liquid-crystal display and high-performance chips, the PSP offers a gaming experience in-line with what consumers have come to expect from Sony's PlayStation 2, which owns the lion's share of the market for home game consoles. The PSP can play video and music as well, and the manufacturer emphasizes that adults can use it to watch movies or enjoy music while passing time on the train or plane.

The day the Nintendo DS went on sale, hordes of people lined up outside major electronic retailers in Tokyo's Shinjuku and Yurakucho districts. Some 570,000 units were sold in the first four days, with the figure rising to over 1 million when earlier sales in the United States are included. Nintendo then raised its sales target of 2 million units in Japan and the United States in 2004 to 2.8 million. While the PSP went on sale first, only a limited number of units - just 200,000 - were shipped immediately. The shortage served to drive demand for the product even higher.

Will Handheld Games Revive the Market?
The video-game industry has been in something of a slump in recent years. According to the Computer Entertainment Suppliers Association, Japan's market for video games, including both consoles and software, peaked at roughly ¥750 billion ($7.14 billion) in 1997 before declining by 41% to a level of ¥450 billion ($4.29 billion) in 2003. Nintendo says that the move away from video games is a result of many people finding them too difficult given all of the advances in recent years as games have become more elaborate and involved. One concept given special weight in the creation of the Nintendo DS was that it should be easy enough for anyone to enjoy, the goal being to attract people who would not otherwise play video games.

Nintendo is trying to maintain its crown in the area of handheld game consoles, while Sony Computer Entertainment is looking to wrest control of the market, and the differences in their approaches can be seen in this light. Both, however, are aiming to attract a new fan base of adult gamers. Each of these firms hopes to fill the spare time that adults have while on the commuter train or during lunch breaks. This battle for the attention of adult consumers appears set to heat up even further.

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Copyright (c) 2005 Web Japan. Edited by Japan Echo Inc. based on domestic Japanese news sources. Articles presented here are offered for reference purposes and do not necessarily represent the policy or views of the Japanese Government.

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