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Launching Lite

What prospects for Nintendo's sexy new DS during a World Cup?

Football fever is running high as the World Cup reaches its half way point this weekend - and many in the games trade have been left wondering whether a high temperature is to blame for Nintendo's surprising decision to launch its redesigned handheld console across Europe today in the midst of such an obvious global distraction.

Yet while the timing debate will continue to flare over the weekend - stoked by initial sales figures due on Monday evening - the broader significance of the launch cannot be understated, forming the next key stage in Nintendo's masterplan to grow the market through innovative software and hardware.

Since the original DS launched in the UK last March, with a then record-breaking opening weekend of 87,000 sales, the dual-screen system has spectacularly defied its critics, racing past the million mark to what is now understood to be an installed base of 1.3 million units in the UK alone - roughly neck and neck with Sony's PSP.

The advent of Lite, with its remarkably effective iPod-generation lifestyle reworking, may well now provide the growth spurt necessary to pull the platform into a position of clear market leadership.

Lite's impact in Japan since its March 2nd launch has been extraordinary. Heavily attended midnight openings kick-started a rush that has seen the system shift well over two million units in just two months. And it's a similar picture in the US, with 136,500 units sold in the first two days alone from June 11th.

Starting on the back foot

Despite these precedents, given the negative impact the World Cup has already had on games retail in the UK (substantially so in software), the mood at retail ahead of this morning's European launch was more optimistic than one might have expected.

"It's not really happened before, a hardware launch during the World Cup," notes Dorian Bloch of UK sales monitor ChartTrack. "But retail are screaming for something to put in the window to try and get the punters in. It won't affect the number of units Nintendo feels it's going to be able to do this year."

"It's nice to see a company giving us something in the middle of the year," agrees Don McCabe, joint MD of leading independent chain Chips. "It would have been nice to have it for Easter, but it's a summer machine - lighter and brighter, a positive item for the holidays. And given this is a relaunch rather than a brand new system, the take-up has been good in terms of pre-orders."

"The World Cup will be a distraction," believes Nick Parker, videogames analyst at Parker Consulting. "Summer holidays from a High Street point of view tend to be a bit quiet, but people do go out and buy gaming products. It's a good time to launch a handheld."

Nintendo UK freely admits it would have preferred to roll out Lite ahead of the World Cup, an aspiration rendered a practical impossibility by intense demand for hardware in other territories.

With no major midnight openings organised by UK retail, official launch partner GAME instead held promotional events this morning at its flagship Oxford Street, London store and its concession in famous Regent Street toy store Hamley's, with the leading UK retailer remaining resolutely upbeat:

"DS Lite is a fantastic console that we are confident will be in great customer demand, regardless of the timing of its launch," insists commercial planning manager Alex Vines. "It will be a key focus for GAME stores over the coming weeks and thanks to its incredible innovation we expect it to make a massive impact."

Away from the specialists, expectations are mixed. For HMV, the timing has proved fortuitous, tying in with a major nationwide sale to combat World Cup-inspired retail weariness. The entertainment chain is offering a bespoke bundle of DS Lite for GBP 99 plus one of four titles (including Brain Training) for an additional GBP 9.99.

"Over the next few days we're expecting huge footfall across all our stores and obviously that coincides nicely with the launch of DS Lite, so we'll try and direct as many people towards games via in-store merchandising and so on," reveals HMV spokesperson Gennaro Castaldo.

But with no similar initiative to piggyback, one games buyer for a leading UK supermarket, who declined to be named, suggests a distinct lack of enthusiasm for the system at least while the World Cup remains a key draw for most consumers.

"We're basically soft-launching it, doing very little, dropping it into market and seeing what happens. But nothing's getting thrown at it in the slightest. Given the market context, it'd be a lot of hard work to get very little at the moment."

Steady as she goes

Nintendo's launch strategy itself is clearly set to slow-burn rather than quick-fire through its initial phase, with a heavy emphasis on software, not hardware.

"The marketing campaign for DS Lite is already underway with a great PR campaign across gaming, lifestyle and mainstream press all hailing DS Lite as the must have gadget of the summer," explains a Nintendo UK representative.

"Initially around launch a GBP 2.5 million software focused campaign will feature DS Lite alongside our key summer titles such as Brain Training, Nintendogs Dalmatian and New Super Mario Bros."

And while such a plan is unlikely to produce the headline grabbing feats seen in other territories, it speaks volumes for the quiet confidence Nintendo has in Lite, happy to sit back and let its blockbuster franchises do the hard work for now.

Eastern promise

DS Lite, of course, does not exist in a vacuum and its continuing performance versus PSP - and the original model - will remain keenly monitored by analysts, retailers and platform holders alike.

The situation in Japan merits attention. Since March 2nd, Lite has sold a staggering 2.2 million units according to official Media Create data. Buoyed by the arrival of New Super Mario Bros., the three weeks up to June 11th saw sales of 285k, 135k and 132k respectively. Significantly, New Super Mario Bros. has also racked up a massive 1.5m units at retail since its release on May 25th. Four DS titles have already surpassed two million sales in Japan alone.

Over the same period, PSP was recording unit sales of around 25k per week, peaking at 45k on the week of Lite's launch, possibly owing to greater footfall at retail. Meanwhile, original DS, which was averaging weekly sales of 30-40k before the launch of Lite, plunged to under 2k for the weeks ending June 4th and June 11th.

While the sheer scale of DS' lead in Japan is unlikely to be repeated in the West (where software tastes can differ wildly), it illustrates a breathtakingly simple truth: great original software sells hardware.

After a slow start, DS hit its stride with Nintendogs and hasn't looked back, with a steady stream of superb platform-exclusive titles. PSP, meanwhile, has been far more reliant on SKUs of multi-platform games. Yet the main instance of a triple-A PSP exclusive - Rockstar's GTA: Liberty City Stories - showed exactly what is possible, flying past 360k units in just eight weeks at UK retail, making it the fastest-selling handheld game since Pokemon Yellow in 2000.

Taking the lead

Titles like Juiced, Tekken and LocoRoco are positive steps for Sony. But with original blockbusters remaining an elusive phenomenon on PSP, many believe that the launch of Lite, plus big games like New Super Mario Bros. will enable Nintendo now to seize the initiative in the UK and Europe.

"DS is making good ground and is going to be the one to beat," predicts Chips boss McCabe. "It will steal a significant march on PSP with Lite, where they've been even up till now. PSP needs a killer app - Nintendo has a production line of solid games."

"I expect DS to win this year, but I don't expect it to win next year," adds Nick Parker. "Sony will get PSP's act together, there's no doubt about that. And it won't necessarily be based on games. PSP will come into its own when PS3 comes out."

'Winning', in its crudest sense, however, is not the focus for Nintendo, with market share taking a back seat to real market growth, which the firm is pushing through broad-appeal, mass-market-priced products like Brain Training.

"Nintendo wants a broader market to target and they want to create Wii as a lifestyle brand," adds Parker. "In doing so they will then create DS as part of that extension and it becomes a lifestyle product - and Lite certainly looks like one; it's beautiful."

And with the ongoing success of the Pink and Blue iterations of the original DS, Nintendo UK claims it will not abandon the older unit any time soon, certainly while those colours remain exclusive.

"We're still committed to the old DS as long as there's demand," asserts a Nintendo UK spokesperson. "Don't forget that the Pink and Blue DS units are only available in the old model, which account for a large percentage of our sales to girls. And like Japan we haven't seen any drop off in sales of the old model in the run-up to the launch of DS Lite".

For now, DS is sitting pretty, set for steady, powerful growth ahead of the launch of Wii later this year - irrespective of when England decides inevitably to shamble its way out of the World Cup.

And Nintendo can always have it both ways. If Lite defies the odds and gets off to a flyer, a gushing press release praising the power of the DS brand will come tripping over its heels. But if it falls foul of football fever, we know what will get the blame.

Johnny Minkley is the editor of our sister site, Eurogamer TV.

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