Nintendo's DS has been breaking all sorts of device sales records since launching, and Sony's PSP hasn't done too badly either... but is all that about to change?
Over the next 12-24 months, the chipsets in high-end handsets are going to have graphics processing power roughly equal to or exceeding Sony's PlayStation 2. That's some serious power for a small screen. Devices like HTC's Touch Diamond and Nokia's Tube are all going to ship with high-res touch (multi touch?) screens, as well. So in the not too distant future we're going to have devices with lots of compute and graphics power, memory, connectivity, with beautiful screens and consistent interaction mechanisms (touch and accelerometers, for example).
What's held mobile games back for the last few years? Well, aside from the crapulence of the games themselves (I can't believe that Guitar Hero III Mobile actually wins awards... have you *tried* it on a BlackBerry? Ugh. It's embarrassingly bad.), it's not the easiest thing to go out and find a game. There's all sorts of operator deck nonsense that a user's got to deal with to actually find the game they want. Of course, that assumes that the developer/publisher has actually struck a deal with the operator in question, so that the game's even available for download. Yikes.
Oh, and between the limited storage on devices and the slow network speeds, it's unlikely that you'd be able to download a very large game w/ lots of rich images and sound... at least not unless you feel like receiving one hell of a bill for data transfer.
On the flip side, anyone can walk into a store and pick up whatever game they want for their PSP or DS... and you just pop in the cartridge and away you go.
How might iPhone change this? Well, first of all, the hardware's pretty good so the kinds of games you can develop are pretty impressive. Go ahead and compare something like Tap Tap Revolution (available through Installer.app for jailbroken iPhones) to Guitar Hero III Mobile and I'll bet you'll be impressed just how much better TTR is, even though it was built by one particularly bright 23-year old developer.
Secondly, discovery isn't a problem... just fire up iTunes and browse around the app store for something that catches your fancy, click-to-buy, and it's sucked down at broadband speeds to your computer and quickly sync'd to your iPhone.
Finally, dealing with one company (Apple) is a whole lot easier than dealing with 40 operators, and Apple takes 30% of the sales revenue, compared to 50-60% in some cases with certain operators.
So, the hardware's pretty good, the discovery problem's pretty well solved, and it makes life a whole lot simpler for developers large and small.
If nothing else, Apple's going to put a lot of pressure on the operators, but they're also going to push others like Nokia to execute and innovate on strategies like Ovi.
But how're Nintendo and Sony going to respond? Between Wiiware and the PS3 Online store, both companies understand the importance of game downloads and online purchases. But can they overcome the massive change in phone capabilities? Remember that DS is wildly outselling PSP, and DS has a comparative paucity of compute power: they've innovated (like Wii) on gameplay. Well, with the hardware being equal or better, and in your pocket anyway, are we looking at the end of the portable console market?
