Future DS and PSP systems

IG: It's been rumored that Nintendo will introduce a more powerful handheld next year, possibly with an Nvidia chipset, and maybe with free 3G wireless capabilities. On the Sony side, it's been rumored that a PSP 2 is coming that will go back to using UMD, following the lukewarm PSPgo reception. What's your take for the future portables from both companies?

Pachter: I think both companies are interested in making money.  Nintendo has been phenomenally successful with the DS, and I think that they are likely going to introduce something to keep that streak alive.  Piracy has hurt them, and the repositioning of the iPod Touch as a gaming device will ultimately impact sales, so it makes sense that they will migrate toward the iPod Touch with the next iteration.  Sony has a tougher hurdle, with the PSP being solely a gaming device that is more expensive than the DS and offers less functionality than the iPod Touch.  I’m not sure that UMD is the answer, but expect to see something from them that addresses the threat from Apple.