Comment: Nintendo's DS inertia could carry it into new markets

If you had told the hugely sceptical audiences who saw the Nintendo DS for the first time at E3 last May that in a little over six months, the Japanese firm would have sold 1.2 million units of the system in not much more than a fortnight and would be cheerfully raising its estimates for the rest of the year to around 2.8 million, many of them would probably have considered you to be some kind of madman. Yet even with the shadow of PlayStation Portable looming large, that's exactly what has happened in the past few weeks.

Nintendo DS has had successful launches in both North America (700,000 units to date) and Japan (over half a million units to date), rivalling the launch figures of the Game Boy Advance in 2001 and surprising a legion of naysayers who dismissed the console's dual screens and touch panel as nothing more than a gimmick. Last week saw the shipment estimates for the rest of the year rising by 40 per cent, with an additional 400,000 units apiece promised to North America and Japan. For a product which Nintendo president Satoru Iwata humbly said would be considered a success if even ten per cent of the company's customers understood it, it's not a bad start.

By contrast, manufacturing volumes will mean that Sony will be lucky to have half a million units of the PlayStation Portable on shelves in Japan by the end of the year, and North America and Europe will have to wait for several months before they see the console. Dogged by concerns about poor battery life and a possible downgrade of its screen quality in order to reduce Sony's losses on hardware manufacturing, it's hardly a stellar launch for a console whose very existence caused Nintendo's share price to drop by more than 10 per cent when Ken Kutaragi announced it at E3 two years ago.

Of course, none of this is to say that the next-gen handheld war is in any way decided as yet. Sony's console still has incredible inertia behind it, a range of big-name software, an attractive design, and most importantly, the all-powerful PlayStation name - albeit looking a touch tarnished since its bruising encounter with the home media market in Japan, where the PSX system remains something of an embarrassment to Sony. It's easy to develop for, and so similar to the PS2 that publishers will be able to port much of their existing portfolio with ease - and undoubtedly will, infuriating hardcore gamers but appealing massively to the existing fanbases of the major franchises.

It's interesting, however, to look at just how much inertia Nintendo has managed to build up since E3. Six months ago, a successful launch for the DS seemed highly unlikely, and the words "Virtual Boy" weren't far from the lips of many snide commentators. In that six months, however, Nintendo seems to have had a change of heart about how to market the product, how to talk about it, how to approach the market aggressively - and even about what market it's really chasing.

The Nintendo we see now isn't the Nintendo that launched the GameCube, or even the Game Boy Advance. It's a Nintendo where president Satoru Iwata is happy to slam his competitor's products for their failings, and where his underlings wryly comment on the PSP's rumoured battery life flaws in front of assembled legions of the press. It's a Nintendo which markets its products to adults, which has learned how to convey the essence of a new console in a simple soundbite - Touch! - and which isn't afraid to market itself on its strengths to both its existing audience, but more importantly, to a huge audience that doesn't even play videogames. Not yet, anyway.

It's easy to look derisively at comments from Iwata-san about how the DS can appeal to people outside the current gaming demographic, by interesting them with control systems they're more familiar with than the analogue stick or D-pad, but doing so misses a fundamental point - namely that he's right. The success of games such as Eye Toy, SingStar and Dance Dance Revolution proves beyond any doubt that there is a market out there that doesn't want to hold a joypad, but is still happy to play games as long as they aren't forced through a learning curve involving oddly labelled buttons and difficult to manipulate control sticks. The problem is working out how to reach those people and tell them about new products - and it's a problem which Nintendo seems to believe it can crack.

If the company which gave us the D-Pad and the console analogue controller in the first place is right, its most enduring creations need to be cast aside to appeal to a broader marketplace. If it can reach that audience, and if it can maintain its current aggressive, intelligent and far-sighted approach to the market, then that's good news for the industry as a whole - and a worrying reminder to both Sony and Microsoft that neither of them is in a two-horse race just yet.