iPhone to Kill Nintendo DS? What is Forbes Smoking?

Over at Forbes Brian Caulfield has posted an editorial piece on "Why Apple Could Kill the Nintendo DS." He argues that the upcoming app store for the iPhone combined with the device's already slick touch-screen and motion sensing capability will make Apple a very tough foe in the handheld gaming arena.

"Unlike Nintendo, which has created a gaming console with a motion-sensitive controller and a touch-sensitive handheld gaming system, Apple has crammed both capabilities into its iPhone and iPod Touch," he writes. "The ability to pour fresh software into the iPhone, wirelessly, at the touch of a button already has game developers interested. ... The worst sign: Sophisticated games such as Electronic Arts' ambitious new god-game, Spore, are already slated to be released for the iPhone at the same time it goes on sale for PCs, Macs and the Nintendo DS. ... Looks like the handheld gaming business, so long dominated by Nintendo, could be about to undergo a little evolution too."

With all due respect Mr. Caulfield, you are talking nonsense. We couldn't help but laugh when we read the article, but just to make sure we weren't losing our marbles we checked in with two prominent analysts. Wedbush Morgan Securities' Michael Pachter noted that it's really about "different markets, hip wealthy people vs. kids." He added, "My kids each have a DS, and my wife has an iPhone. The article is too stupid to even discuss." Harsh.

DFC Intelligence's David Cole agreed 100 percent. Regarding Forbes' premise he commented, "I think it is just people that don't really know the industry looking to hype the next big thing. Cell phones in general were supposed to kill Nintendo's business many years ago. The DS sold 30 million units last year. The iPhone has been out less than a year, but I think quarterly sales have been between like 1-2 million units."

Looking at official numbers from Apple, we can see that the iPhone sold 1.119 million units in the 2007 July – September quarter (which at the time brought cumulative fiscal 2007 sales to 1.389 million), 2.315 million units in the 2007 October – December quarter, and 1.703 million units in the most recent January – March period.

"That isn't even in the same league as the DS...DS shipments have been between 6-11 million per quarter over the past year," Cole pointed out. "The other issue is that an average cell phone has a lifespan of two years and a much higher retirement factor than the DS."

Needless to say, Nintendo has nothing to fear. Mario and co. will likely continue dominating the handheld scene for quite some time.