Nintendo's Biggest Competitor Is Apple

12 Nov 2009 at 13:48:06 by Tim McDonald

Nintendo's biggest rival may not be Sony or Microsoft, but Apple.

An article in the Wall Street Journal posits that Nintendo's DS-based dominance of the handheld market has been heavily challenged by recent Apple products such as the iPhone and the iPod Touch.

The two companies appear to have different thoughts on the rivalry, though. Satoru Iwata, president of Nintendo, says that talk of a rivalry makes him "uncomfortable" as he claims it to be untrue, while Apple's head of marketing Phil Schiller claims the opposite, stating that the DS and the PSP "seemed so cool" but now "don't stack up" to the iPod Touch and iPhone.

Research firm DFS Intelligence apparently believes that the DS and the PSP have peaked, and the Apple products will be the ones driving handheld gaming for the next five years. The company references estimations that iPhone and iPod Touch game revenues will rise from $46 million USD to over $2.8 billion USD in 2014, while software revenue for handheld games systems are apparently expected to shrink by 27% to $6.3 billion USD over the same period.

It's worth noting that these estimations still give the handheld market a $3.5 billion USD lead in terms of software sales, though, which is not to be sniffed at. It's also worth noting that Nintendo has a new iteration of the DS coming out in Japan this month (to follow in the rest of the world in Q1 2010).

Then again, it's also worth noting that Nintendo profits have dropped for the first time in six years, although it's hard to believe that this is solely down to Apple.

Personally, I'm not sure I believe this. While it might be true that Apple is emerging as a competitor, the Apple products aren't built purely as game devices and it's a little hard to consider the company the "biggest rival" to Nintendo. Sony agrees, too, with a spokesman for Sony's games division commenting "From the actual game play to the games themselves, we don't see any real overlap."

iPhones and iPod Touches are certainly things that we many, many people will have, which will definitely account for an increase in games sales, but I think it'll be awhile before these products become a serious competitor, despite free (and cheaper) games. If smart developers start taking the iPhone seriously, though, and the game quality increases exponentially - then with the cheaper price and the ubiquitousness of the device, we might have a real rivalry on our hands.

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