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Nintendo unveils new touchscreen controller

Los Angeles, June 8, 2011

Nintendo has unwrapped a new touchscreen controller as part of its next-generation Wii aimed at winning back hardcore gamers from rivals such as Microsoft Corp's Xbox, drawing praise from gaming critics but disappointing investors.

While the first new gaming console in five years fell short of being the game-changer the original was -- luring millions of new casual users with its simplicity and motion-control -- industry executives and analysts gave the Wii U's touchscreen controller the thumbs-up.

Shareholders were underwhelmed, however, pushing the company's stock to a five-year low on concerns its strategy is too focused on hardware as the gaming market shifts to social networking.

Industry critics in early reviews praised the innovation embodied by the separate device, larger than Apple’s  iPhone, but smaller than the iPad. It has a touchscreen, camera and video-call capability, plus an array of buttons and functions that might entice gamers who play longer and more intensely.

Nintendo retains the lead in gaming hardware, but is struggling to win users from Microsoft and Sony after the disappointing introduction of its 3DS handheld device. Gaming executives now hope the new Wii can jumpstart a $65 billion video games industry -- surpassing Hollywood in size -- still struggling to rebound from the recession.

The entire console is still under development, but is expected to go on sale between April and December 2012. No price has been set, but some speculate it could move for $299, or about the same as an Xbox twinned with a Kinect motion-sensing system.

"The controller is a breakthrough," said Sterne Agee analyst Arvind Bhatia. "Overall, Wii U looks good, but I have to say I wasn't blown away."

That is a far cry from how the Wii took the industry by storm after its November 2006 launch, bringing motion control to gamers accustomed to joysticks and mice. Whether its latest gadget can win over a notoriously fickle market remains to be seen.

Nintendo shares in Tokyo slumped 5.5 per cent to 16,880 yen, a level last seen before it launched the original Wii in 2006.

Investors said they needed more details on price and other specifications and that they were worried Nintendo remained too centred on hardware as the gaming market increasingly shifts to  a software battleground.

"Although some experts seem to like the new device, I expected Nintendo to move more into the social networking business," said Mitsuo Shimizu, deputy general manager at Cosmo Securities in Tokyo.

"It's a warning from investors that the company should reconsider its business strategy and move more aggressively into social gaming operations.”

Though it may not repeat the first Wii bonanza, the new Nintendo device, nonetheless, will exert some pressure on traditional console rivals such as Microsoft and Sony Corp  to come up with new systems.

"It's smart for a number of reasons. There are two levels of interface, the touchscreen for casual gamers and the buttons for more core types," said Ricardo Torres, editor-in-chief for popular games site gamespot.com. "They have a lot of games core gamers care about. It's like a sandbox for developers. It's up to them to decide the experience that works best."

Stealing the limelight

The new console is the first Nintendo device to support high-definition graphics and will sport a microprocessor or brain from IBM and graphics processors from Advanced Micro Devices.

But it was the controller that stole the limelight on Tuesday. Its 6.2-inch touchscreen works like a second display and can show the same images that are on the TV screen or provide gamers with additional information, giving them an edge over competitors.

The Wii U's controller can also be used to make voice calls and run old Nintendo games. It has motion-sensor capabilities and works in conjunction with existing Wii controllers. With its array of buttons, the device could appeal to hardcore gamers who could use it for first-person shooter games.

The device also acts as a stand-alone gaming gadget. It can, for instance, continue running a game on the touchscreen while someone else watches TV. But it functions only in wireless connection with a Wii U console.

"It's still a tethered experience so it's not fully tablet-like," said BMO Capital Markets analyst Ed Williams.  But "without a doubt, they are ahead of their peers and are putting themselves in a different position. But what we still need to see is how it will go over with consumers."

With more than a year to market, Nintendo could still make modifications and the game slate might change. – Reuters




Tags: Apple | Sony | Nintendo | Los Angeles | Wii | Touchscreen controller |

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