Sony's new PSP: Does it matter to Nintendo?


Sony (NYSE: SNE) is coming out with a new PSP. Should Nintendo (OTC: NTDOY) care? In a word: no.

According to reports, Sony will be releasing the PSP Go this fall. The big thing about the unit is that it will be small. Oh, and it will be driven by downloaded games and other content. And, quite honestly, I'm not sure it's going to offer up a lot of significant competition to the Nintendo DS.

The first thing that makes me skeptical about the unit is its size. This might be just my own bias, but do people really enjoy playing games on a tiny device? Maybe that's not a great criticism. After all, I think the Apple (NASDAQ: AAPL) iPod devices are also too small to watch movies on, yet we all know what a failure that technology was, don't we? (Just in case: that was sarcasm, folks.)

The second thing that makes me skeptical is the whole idea of downloading stuff. For some reason, I'm not sure consumer psychology is at the point where gamers will accept the idea of downloading content to a version of a device that they previously purchased discs for. That comment can be argued against very easily. People download things on all kinds of devices these days. Nevertheless, I have to wonder if it's going to change the perception of the device and turn it into an example of technological novelty.

The third thing I think about upon hearing the news of the PSP Go is the old Nintendo Game Boy Micro. That was a smaller version of the Game Boy Advance. It didn't succeed.

The fourth issue is the price. It's reportedly going to be $249. Will parents buy such an expensive gadget for Christmas?

So, in conclusion, I don't think Nintendo has to stay up late at night worrying about the demise of the Nintendo DS, or even the new Nintendo DSi. And when it comes to shares of Sony and Nintendo, I don't see either as a buy at the moment.

Disclosure: I don't own any company mentioned; positions can change without notice.

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