Nintendo DS vs. Sony PSP

The portable gaming war is on.

As Fool Seth Jayson noted last week, Nintendo (OTC BB: NTDOY) had sold half a million of its portable Nintendo DS units within a week of their November 21 launch in the United States. The Nintendo DS went on sale on December 2 in Japan, and the company said last night that combined sales in the U.S. and Japan have already reached 1 million units. Another highly anticipated portable system, the Sony (NYSE: SNE  ) PSP, goes on sale this weekend in Japan, though a U.S. debut won't come until March 2005 at the earliest.

So how do they compare?

Nintendo has long dominated the portable gaming market with its Game Boy and Game Boy Advance. The Nintendo DS (DS stands for dual screen, one of which can be used as a touch pad) represents a sophisticated upgrade over the Game Boy Advance, but at $150 per unit and a mere $30 per game, stands to be much more accessible to the average gamer than the premium-priced Sony PSP. Nintendo's main advantage has always been its first-party games, and that is the case here as well: While third-party games such as Electronic Arts' (Nasdaq: ERTS  ) Madden NFL 2005 and Namco'sRidge Racer will be available, gamers will buy the Nintendo DS to play portable versions of Mario and Metroid.

The DS also plays Game Boy Advance games -- a huge advantage, especially given that Nintendo recently re-released the classic eight-bit games from the days of the Nintendo Entertainment System.

The Sony PSP is a bit different. It is meant to showcase the power of the PlayStation 2 in a sleek package that could cost as little as $200 or as much as $300 per unit. In contrast to the Nintendo DS, the PSP is aimed strictly at the hard-core gamer, with feature titles such as Gran Turismo 4, Syphon Filter, Activision's (Nasdaq: ATVI  ) Tony Hawk's Underground 2, and new versions of Konami's (NYSE: KNM  ) Metal Gear and Capcom'sDevil May Cry. Another attraction is that the PSP can play both music and movies in its proprietary UMD (universal media disc) format, as well as ATRAC3 and MP3s on memory sticks.

Both systems feature wi-fi functionality for multiplayer gaming.

Sony faces a couple of problems. The first is that I'm not convinced that gamers will pay up to play portable Gran Turismo -- that's what the PlayStation 2 is for. What's more, the price tag might not make multiplayer action affordable, either. Lastly, there's the issue of battery life -- the PSP is expected to last four to eight hours for playing games, but only two and a half hours for watching movies.

That could make for some frustrating experiences.

It doesn't hurt that the Nintendo DS is out in time for the holidays, either. All said, as it's the incumbent -- and it has a cheaper price tag, cheaper games, and backwards compatibility -- I think that Nintendo DS is clearly the system to beat.

Electronic Arts and Activision are among David Gardner'sMotley Fool Stock Advisorrecommendations. Learn which other companies have earned his nod by subscribing today with the benefit of a six-month money-back guarantee.

Fool contributor Jeff Hwang owns shares of Electronic Arts.


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