iPhone gaming has been booming and Android has been coming on strong as well. The popularity of smartphones in general appears to be putting a dent in the traditional handheld space. Nintendo and others have complained that mobile apps are devaluing games, but rather than complain, companies like Nintendo and Sony will need to react and "reinvent" handheld gaming, say some developers and analysts.
In a recent interview with Alan Wake developer Remedy Entertainment (whose iOS game Death Rally has been faring well) EVP Aki Järvilehto noted the challenge that traditional console and handheld hardware now faces.
"Many smartphones and tablets offer mind blowing value to gamers. Right now you can buy tons and tons of fun on iOS with the price of a single handheld console game. Heck, you can get tons of fun for free with advertising based concepts. So I do think the traditional handheld consoles will need to reinvent themselves if they want to compete," he told us.
M2 Research analyst Billy Pidgeon also believes the handheld space will need to adjust its strategy, particularly when it comes to online gaming. "Unless Nintendo and Sony can re-invent online portable gaming and get hardcore gamers to buy in, both companies should be worried, not necessarily about Apple, but about mobile overall," he warned.

