After years spent cultivating hardcore gamers who don't blanch at paying top dollar for slick new hardware, the video game industry is now aiming at the rest of the world.
Kazuo Hirai, president and chief executive of Sony Computer Entertainment America, proclaimed this is "the year to cultivate the casual gaming market"; in pursuit of that goal, the company cut the price of its PlayStation 2 console to $149.
Meanwhile, Nintendo of America Inc. Senior Vice President of Marketing George Harrison said that his company is aiming at "late adopters" who care mostly about getting a good deal for their entertainment dollar.
And at a press event Monday night, Xbox console maker Microsoft Corp. emphasized new titles for the Xbox Live online service aimed at casual gamers -- players "who just need a quick fix," as corporate Vice President J. Allard put it. One of those titles: a version of the '80s Atari classic, Dig Dug.
Unlike in previous installments of the Electronic Entertainment Expo (E3 for short), the industry's annual trade show here, none of these big-three firms made sweeping announcements about plans for new, high-powered game consoles.
The one new category of hardware shown off at the show will not sit under a television set, but it will fit handily inside a backpack.
Nintendo unveiled the Nintendo DS, a successor to its nearly ubiquitous GameBoy Advance handheld. And Sony showed off the PSP, a portable PlayStation that represents its first move into a market that has long been defined by Nintendo -- and has defeated many other would-be competitors.
The two handhelds show different philosophies about what customers are supposed to want. Nintendo is a game company that sticks to the games; Sony, on the other hand, is a consumer electronics and entertainment juggernaut that can think of many ways to make money off a gaming device besides just games.
At its press conference, Sony showed the PSP playing a trailer for the upcoming movie "Spider-Man 2" and said music and movie companies have already expressed interest in distributing their content on the coin-sized discs the PSP will use. The PSP will also play songs purchased from Sony's Connect online music store.
Oh, and the PSP will also play games. Electronic Arts Inc., the world's largest game publisher, was on hand to show off handheld versions of NBA Street, NFL Street and its Tiger Woods golf game. EA studio head Don A. Mattrick said the company has 100 engineers and designers plugging away on titles for the device.
Nintendo, on the other hand, plans to compete on the strengths of its own popular titles more than its handheld's specifications or any tie-ins to music services. Said Satoru Iwata, president of Nintendo Co.: "The time when horsepower alone makes a difference is over."
Nintendo's innovation this time out consists of including two small video screens on the Nintendo DS (short for "dual screen") that allow different views of the action in a game. In a new version of the popular Metroid Prime franchise, for example, players will see their characters running around, shooting and creating havoc in one screen, while referring to a map on the handheld's other screen.
Both Nintendo and Sony do seem to agree on one thing: Each of these handhelds will include WiFi wireless-Internet receivers to allow players to connect with, and compete against, one another.
Another thing in common: Neither device will be available anytime soon. Nintendo said the company plans to get the new handheld on the market by the end of the year; Sony is shooting for a U.S. release next year. Neither company shared a price for its device.
It's a tough battle for analysts to handicap. Many companies have tried to move onto Nintendo's turf by introducing a new handheld gaming device, and none has succeeded since the first GameBoy debuted in 1989. Cell-phone maker Nokia Corp.'s recent attempt to offer a cell phone melded to a game device, called the N-Gage, floundered.
But no Nintendo rival has had as much clout as Sony. "Sony clearly has an established brand, but Nintendo owns the handheld market," said Paul-Jon McNealy, an analyst with American Technology Research Inc.
Nintendo may need a win in the handheld market more than Sony.
In North America, its GameCube console has been bumped from second to third place in the market by Microsoft's Xbox. According to the research firm NPD Group Inc., 22 million PlayStation 2 consoles, 7.7 million Xboxes and 6.8 million GameCubes had been sold in the United States by the end of 2003.
Poor Xbox sales in Japan, however, have allowed Nintendo to hang onto a rough tie with Microsoft worldwide.
Microsoft once seemed an unlikely major player in the world of console video games, but that has changed, said Robert J. Bach, senior Xbox officer at Microsoft. "We are part of the landscape, a recognized player," he said.
The most significant sign of the Xbox's arrival came when Electronic Arts announced that it would make its sports titles available on Microsoft's Xbox Live service. EA is the dominant player in the sports video game market, but it had supported online game play only on its PlayStation 2 releases.
Microsoft also advertised its growing developer support by showing off a few Xbox exclusives, such as Doom 3 and Halo 2 -- even though E3 attendees had already seen these much-delayed games demonstrated at last year's show.
To counter that skepticism, Microsoft proclaimed that Halo 2 will reach store shelves on Nov. 9 of this year. "We're getting pretty damn close," said Joe Staten, one of the game's developers. "We're busting our [rears]."
St. Louis Rams running back Marshall Faulk and boxing legend Muhammad Ali appear as Microsoft announces new Xbox titles before E3 opens.