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Analyst: DS Successor To Hit In Next 15 Months?
Analyst: DS Successor To Hit In Next 15 Months?
January 15, 2010 | By Leigh Alexander

January 15, 2010 | By Leigh Alexander
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More: Console/PC



The Nintendo DS had a record 2009 -- the best year for any system in console gaming history, the company says. Yet one analyst sees signs that suggest the company will unveil a new portable within the next eight months.

Look no further than the company's historical market strategy, says EEDAR's Jesse Divnich, who believes that "one of the biggest reasons for Nintendo’s success in the handheld market is their ability to remove opportunity gaps for competitors to enter."

"Nintendo’s transition from the GBA to the DS, a year earlier than anticipated, was a brilliant strategy to remove any upper hand the Sony PSP could have by being first to market," says Divnich.

In the year 2010, Nintendo's continuing face-off against the PSP seems less relevant than the overall sea change in the portable market brought about by the explosive iPhone.

Third-party publishers are providing some portents that the DS may have had its last banner year. Perhaps the biggest signal is Ubisoft's recent financial warning, shifting from a forecast of a profitable fiscal year to a loss due in large part to a major contraction in the market for casual and family-friendly software on DS.

Specifically, Ubisoft said revenue from its casual portfolio, which relies heavily on Nintendo platforms, has fallen 50 percent during 2009.

"Many publishers including Sega, Capcom, and now Ubisoft have all expressed that they may be reducing their exposure to Nintendo’s consoles, which will likely lead to heavy declines in both hardware and software sales for the Nintendo DS," said Divnich -- although it should be noted that Sega and Capcom were speaking to the potential specifically for mature-oriented core titles on Wii.

Divnich also says that pirates are quickly finding ways around the DSi's new security measures, and that the loss of software dollars to piracy is a continuing problem on portable platforms. A hardware revamp -- one that includes backwards compatibility -- should be just the thing, claims the analyst.

"We believe that due to the aging technology, the possibility of new competitors in 2011, [and] a decline in publisher support and piracy, Nintendo will launch a successor to the DS within the next 15 months, and likely announce such in the next eight months," the analyst concludes.


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