Hand-To-Hand Combat The videogame world has been sweaty-palmed awaiting the launch of new, mobile gaming units from Sony and Nintendo. Let the battle begin.
By Peter Lewis

(FORTUNE Magazine) – The gloves are coming off in the fight to dominate handheld gaming. At May's Electronic Entertainment Expo in Los Angeles, the annual showcase for the multibillion-dollar videogame industry, Sony, Microsoft, Nintendo, and even Nokia took turns putting down one another as they declared their wish to get into the pockets of millions of game enthusiasts, both literally and figuratively.

Sony unveiled its long-awaited PlayStation Portable (PSP), which won't show up in the U.S. until next spring. Nokia revealed its N-Gage QD, a phone-and-games device that fixes many of the problems that doomed the original taco-shaped N-Gage. Microsoft--cue the Darth Vader soundtrack--bragged how its software could link all sorts of mobile devices to an Xbox console. But it was Nintendo, long the leader in handheld gaming, that stole the show.

Nintendo's mobile device--code-named the DS--is double the fun of the current Game Boy Advance. Due to hit stores this year, the DS is Nintendo's answer both to Sony's planned PSP attack on its handheld monopoly--more than 150 million Game Boys have been sold--and to the threat from games played over ubiquitous mobile phones. Although the DS and PSP aim at different markets--analysts expect the PSP to cost between $300 and $500, vs. less than $200 for the DS--they will inevitably be compared.

Let's start with the PSP. It has nearly the same graphics-processing power as a PlayStation 2 console, packed into a sleek, black deck that's about seven inches wide, three inches tall, and less than an inch thick. It weighs nine ounces. Most of the device's face is taken up by a 4.3-inch LCD display in the widescreen ratio favored for watching DVD movies. That's no mistake: Sony sees the PSP as much more than a game device. Its universal media disc, or UMD--a new mini-CD that stores 1.8 gigabytes of audio, video, or data--will let Sony distribute feature films, music-concert videos, and other copy-protected entertainment for the PSP. Yet even if the PSP doesn't instantly catch on as a handheld media center, it will be a force in gaming: Just about all of the world's major videogame companies have signed up to produce games for the device. The PSP has built-in 802.11b Wi-Fi networking for surfing or multiplayer gaming, a USB 2.0 port for transferring files or adding peripherals like USB digital cameras and keyboards, and a Memory Stick Duo storage-card slot.

The Nintendo DS prototype got the biggest cheers from the audience. Slightly larger than today's Game Boy Advance SP, the DS has dual slots to accommodate GBA cartridges as well as new postage-stamp-sized DS cartridges. It has dual backlighted LCD color screens, one in the top part of a clamshell lid and the other in the base. The screen in the base is touch sensitive--opening the way for games that involve, say, drawing or manipulating objects with a stylus. Just stab at the villains instead of shooting them! There's also a microphone, raising the tantalizing possibility of voice-activated games. With my luck, on my next flight I'll get stuck sitting in front a kid screaming, "SHOOT! KILL! DIE!" at his DS. Hmm. On second thought, the DS's promised battery life of up to ten hours doesn't seem quite so appealing.

The DS incorporates two forms of Wi-Fi wireless networking, one the standard 802.11b (hello, Internet), the other proprietary to Nintendo. The latter system can allow as many as 16 DS-toting friends to play one another or, thanks to the touch-sensitive screen, to exchange handwritten notes or drawings. It could be the biggest advance in classroom cheating since the PDA.

It will be months before the DS and the PSP reach stores. That'll give tens of millions of gamers plenty of time to debate which is the best. One thing's certain: Both devices have the potential to change the rules of the game in electronic entertainment.

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