Despite the popularity of the Nintendo [TYO:7974] DS in the United States, Japanese buyers are apparently bored with the device and sales are sinking (especially in comparison to Sony's [NYSE:SNE] PSP). According to Wedbush Morgan analyst Michael Pachter, that may spur Nintendo to release a whole new mobile gaming console in Q4. Here's what he says about the prospect:
Sure, it's a little redundant, but if Pachter's analysis is correct, then we could be seeing some kind of DS2 in the US by mid-year next year. Since the touch concept of the current DS is so popular, it would probably maintain that functionality, but perhaps grow in screen size, networking or in other evolutionary ways. Most Japan-based tech companies do indeed react disproportionately to their domestic market, so there's good reason to believe that Pachter's on the right track — but only time will tell.
We think that the timing of a new product introduction will depend upon the sales profile for the DS, and believe that lower than expected DS hardware sales could trigger an earlier launch for the new device. DS sales are solid worldwide, but are weak in Japan, leading us to expect an introduction of a new device in Japan before the end of the calendar year. We think that Nintendo has a new handheld device ready for launch in [Japan] before the end of the calendar year.