It’s no surprise that Apple is doing quite well in the portable gaming space with the iPhone and iPod Touch, especially after the rise of the App Store. Now the Wall Street Journal is reporting that they may also be shaping up as a legitimate threat to Nintendo. Last month Nintendo “reported a 52% drop in profit for the first half of this fiscal year”, and also “predicted its annual profit would fall for the first time in six years.” Meanwhile, more games are popping up on the App Store, in particular those from big-name developers. And let’s not forget that they’re generally cheaper than Nintendo DS games.

I can see the parallel WSJ is trying to make here, but I don’t think Nintendo is being affected as much by Apple’s success as they think. The DS has been around since 2004, and since then has made insane amounts of money for Nintendo. Now that we’re five years (and several hardware revisions) on with the DS, it’s no surprise at all that sales may be slowing down. And while the iPhone/iPod Touch can be a great platform for some games, you still need a dedicated portable gaming device that actually has a control pad and real buttons for many others.

More than stealing customers away from Nintendo, it seems to me that Apple is carving out a whole new market of game players, not unlike what Nintendo themselves accomplished with the Wii. When the next portable Nintendo system gets released, you can bet their profits will once again skyrocket.

[Source: WSJ]