I swear this forum sometimes seems like 13 year olds battling over whose daddy is stronger...
Ok, here go my 50c on the subject:
Bottomline 1: Competition is good for gamers
Bottomline 2: DS DOES pose a big threat in Sonys eyes, big enough to make such a move that wasn't at all expected before DS's introduction
Ok, so Ill make my educated guess on how things panned out from a business perspective (im a business bachelor, cant help it).
DS is, in my eyes, a very smart move by nintendo that is working really good from a strategical standpoint. Nintendo doesn't want sony to have a new system on the market without any direct competition for a couple of years befor GBNext hits. This could have the same effect PSone had when it launched and give sony too great of a head start (a thought Iwata expressed as very important on the next gen homeconsole battle as well).
The answer: the DS. They announced it at E3 and it really took off. I guess Sony wasn't expecting this kind of response from Nintendo, and certainly not expecting the attention it got. Seriously, I believe Sony wasn't at all intending on releasing PSP at that pricepoint.
Sony's price is, in my eyes, a rection to srong DS competition. And they played their card just perfect. It is the perfect price to put Nintendo in trouble. The question is: will Nintendo now follow suit? That's a hard desition for N executives. You don't want a price so low that people percieve it ti be a much lower quality product from PSP, because its price is just high enough. My guess it could go to $129 or $139. But I presumme it wount go down al all.
Anyway, as far as how successfull both machines will be I will, with great caution, say that both of them will be very successfull. NOTE TO DOOMSAYERS: With that lineup of games DS WOUNT FAIL. Period. It will do incredibely well actually.
My guess is Nintendo will dominate with both, DS and AGB 70-75% of the handheld market in 2005. In 2006 Nintendo will have + or - 65% of the market and sony 35%.
GBNext startegy will be interesting to see and how it goes from there onwards depends on it.