Handheld Video Game Player Shipments to Rise 4.9 Percent in 2009

The global market for handheld video game systems is set to buck weak conditions in the global consumer electronics market and rise by 4.9 percent in units and 8.2 percent in revenue during 2009, due to moves by Sony Corp. and Nintendo to freshen up their products, according to iSuppli Corp.

Sony in October 2008 updated its PlayStation Portable (PSP) device and Nintendo in November did the same for its DS device, now called the DSi.

Shipments of handheld game consoles are set to grow to 63.5 million units by 2013, up from 49.4 million units in 2008. This equates to a Compound Annual Growth Rate (CAGR) of 5.2 percent during the forecast period. Revenues are set to grow to $8.1 billion by 2013, rising at a CAGR of 6.4 percent from $5.9 billion in 2008.

While the long-term growth rate isn’t staggering by any means, Nintendo’s and Sony’s platform revisions should keep their portable game console shipments growing until they are able to roll out next-generation handheld platforms. However, if both companies had introduced true next-generation platforms, the level of growth in 2009 and beyond would have been much higher. Most consumers will hold off on any purchase or upgrade until a next-generation handheld gaming device is available.

iSuppli believes Sony and Nintendo will not introduce next-generation handheld video game consoles until 2011, at the earliest.


PSP-3000
In October of 2008, Sony updated its venerable PSP device, called the PSP-3000, with a retail price of $169.99. The main upgrades to the device included an integrated microphone, a screen with a five times brighter color ratio, new button designs and anti-reflective technology to improve outdoor playability. iSuppli believes that at some time after 2010, Sony will release a new portable gaming platform that will help to further drive the handheld gaming market.

Nintendo DSi
In November 2008, Nintendo launched its third generation of DS, called the DSi, in Japan. Nintendo in April released the device in Europe and North America.

The main enhancements to the Nintendo DSi revision include a form factor that is 12 percent thinner than the DS Lite, upgraded dual screen displays enlarged to 3.25-inches in size, the integration of two digital cameras, improved
speakers, an SD card storage slot and internal flash memory for storing downloaded games. At a retail price of $169.99, the DSi will allow Nintendo to continue to expand its sales despite a weak economy until it rolls out a new multifunction device in the next few years.