PSP2 will be "dead on arrival"

By Fred Dutton Published 6 December, 2010

Analyst reckons handhelds are in trouble.

Sony's next handheld will be "dead on arrival", believes industry analyst Michael Pachter.

Speaking on his weekly Game Trailers Q&A, the Wedbush Morgan chatterbox pulled out his crystal ball and claimed, "We are approaching saturation on the handheld market.

"We're starting to see DS sales crack. The ubiquity of the iPod touch is cutting into the handheld market. I think the PSP is dead on arrival, I think the PSP2 is dead on arrival.

"It looks to me like young kids are just as happy playing with an iPod Touch or a Nano," he continued.

"The 3DS will prolong the handheld market for the game manufacturers but ultimately I think handhelds are in trouble.

"What's the difference if you play Tetris on an iPod Touch or Tetris on a DS? You pay a buck on the iPod Touch and you pay 20 bucks on the the DS. Parents prefer one dollar software.

"After the 3DS has its little rush, I think handhelds will continue to decline," he concludes.

There's still no word on when Sony's supposedly doomed PSP follow-up will be hitting the shelves, or whether you'll be able to play $1 Tetris on it, but Nintendo's 3DS arrives in March next year. And don't forget, there's also that rumoured PlayStation Phone allegedly in the works too.

Picture of Fred.

About Fred Dutton

Fred Dutton is Eurogamer's US news editor, based in Washington DC.

Read more articles from Fred by visiting the Fred Dutton archive page.

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Comments (69) Latest comment 1 year ago

Comments for this article are now closed, but please feel free to continue chatting on the forum!

  • sfp_noodle #1 1 year ago

    Yes, because I'm sure you can get games like God of War, Super Mario Brothers and Grand Theft Auto on an iPod/Pad right? Honestly, how is this guy an analyst?

  • kwesleyb #2 1 year ago

    I started laughing when he made a comparison using Tetris. What an idiot he is.

  • pac666 #3 1 year ago

    The Analyst doesn't understand what he is talking about.

    Nntendo hold the key and it's called quality software that you can't experience anywhere else.

  • peterfll #4 1 year ago

    Well, if the 3DS has a good chance of being a success (and I think it does), there's nothing stopping Sony from being successful with the PSP2 is there? Whether Sony screws it up is another question.

    As for predicting what happens after that, well, who gives a toss what this guy thinks?

    \waits for flying car to come pick him up
    Edited by peterfll at 06/12/10 @ 20:48

  • skuzmuffin #5 1 year ago

    He is a muppet.

    And I for one cant wait for the PSP2

  • Perfecto #6 1 year ago

    I don't think you guys actually understand what he's talking about. As an analyst, he isn't making a declaration on which console will have the best games "the ones proper gamers want to play". He's predicting which ones are going to sell and dominate the market, and to be honest putting your money behind Apple's product range instead of backing Sony's PSP2 seems obvious to anyone with at least half a brain.

    Do you guys not remember the sham that was the PSP and PSPgo?

  • lockload #7 1 year ago

    Interesting talking to a few people at work all their kids want are ipod touches or iphones they dont want handhelds anymore

  • chasejamie #8 1 year ago

    Analyst. The clue is in the name.

  • markyHD #9 1 year ago

    If I just insert a 'c' there......yes....he is infact an.............. anal cyst

  • randompanda #10 1 year ago

    Wasn't GTA Chinatown on iPhone, noodle?

  • JayG #11 1 year ago

    Hasn't the PSP outsold the Playstation 3? And it's not only kids that play handhelds, my mother, sister and wife all own a DS as well as a phone, and usually use the DS to play on.

  • SeesThroughAll #12 1 year ago

    Wow... how practical is it to play games on a Nano? Can you even see anything? :D

  • SeesThroughAll #13 1 year ago

    @Perfecto: the PSPgo was a complete failure, the PSP... really not.

  • Skurmedel #14 1 year ago

    His guesses are dead on arrival. Is there no other analyst EG can consult?

  • Peew971 #15 1 year ago

    He's right, it's all migrating to mobile gaming.

  • paulf #16 1 year ago

    and that's my informed opinion for 100k a year thankyou very much

  • Lamb #17 1 year ago

    Hello DS, it prints money!!! If the 3DS only does good thats still lots of profit.

    Somewhat unfair to say that the PSP is dead, GOS, MH3, 3rdB.
    Maybe the PSPGo was dead. A lack of quality games on an overpriced system that has no battery life whatsoever. But people got homebrew! Those sales should pick up now that its half price though the battery is still lacking.

    He makes a valid point about downward pressure on prices in the tots bracket. But why wouldn't that be a handmedown of an old DS or PSP to buy a next gen system? Do you want your tots angst ridden on crappy teenage music that they must have an ipod? But you stiil have the handmedown of your old ipod so he gets some stats from there.

  • solidSnake04 #18 1 year ago

    @chasejamie
    Analyst. The clue is in the name.

    thats well funny

  • IronGiant #19 1 year ago

    Yes the psp continues to do awful business in japan.. I do question the need for a ps phone and the psp2 though, If the psp2 is a beast on specs and features then I'll get one!

  • GamesConnoisseur #20 1 year ago

    What is going great gun for the iPhone, touchscreen, phone and internet functions etc, all in one wonder device etc, can be emulated or translated into PSP2.

    I think that would be smart move by Sony, to put everything into one ultimate walking media and gaming device, that gives you book, GPS, shopping, phone, movies and games.

    THEN its can be in position to threaten the Apple, even if its gaming only then I would be still interested in PSP2 but can see the concern as to how it can compete effectively against the type of the device and the new type of the market its had brought along.

    App 59p cheap and cheerful games are not going to dissappear, and when you get SAME game available on PSP2 that are sold at much friendlier price at App Store... you ll see troubles!

  • beastmaster #21 1 year ago

    Nintendo will dominate with the 3DS. It all depends on Sony really. They'll probably price it at £500 or something stupid.

  • hobojebus #22 1 year ago

    I dont get sony in the last few years, its like they want out of the games market but really want to destroy their reputation first.

    PsP has never performed that well, PsPgo had more returns than the 360 during its RRoD period, why on earth are they releasing a new version? Sony you lost the hand held market accept it and move on.

  • hoster #23 1 year ago

    Michael Pachter is an awesome soothsayer. He learnt about the impending doom of the PSP2 by consulting some chicken entrails. Don't mess with him, or he'll curse you with seven years bad weather!

  • Incarta #24 1 year ago

    He's not entirely wrong. My littlest brother is 12 and he wants an iPod Touch. He hasn't said a word about wanting a PSP and hasn't even heard of the 3DS.

    Although, I think Ninty and Sony will be alright. They'll always have some exclusives that'll make their handhelds worth having. Can't play Mario Kart on anything Apple make afterall.

  • Zaiz #25 1 year ago

    I don't think the mobile games market will make it as well as people think unless prices go over 10 USD, or else it'll be dominated by gimmicky, cheap games from dedicated mobile games makers. The big companies can't make a profit on em' I'd imagine. Or at least an acceptable profit.

  • ShiroBen #26 1 year ago

    Lately I feel like these 'analysts' are just highly paid trolls.

  • brseg #27 1 year ago

    Not sure why theres so much disagreement on this one(?). Its hardly pushing the boat out to say apple will eat into the handheld market -- it already has, in a massive way. You'd be a brave man to invest in making a psp2 game.
    Fwiw, I enjoy his weekly pach-attack vid...
    Edited by brseg at 06/12/10 @ 22:48

  • Caimbeul #28 1 year ago

    "We're starting to see DS sales crack. The ubiquity of the iPod touch is cutting into the handheld market. I think the PSP is dead on arrival, I think the PSP2 is dead on arrival." DS sales are slowing because every fucker in the world and their parents/grandparents have one. Hence a new handheld is being released by Nintendo. Also the PSP was not dead on arrival it was just too fucking expensive at release and a shite screen and battery that was later sorted.

    "It looks to me like young kids are just as happy playing with an iPod Touch or a Nano," he continued. Speak for yourself, i fucking hate touch screen gaming on ipod and phones (except angry birds and solitaire)

    As always ANALyst talking shite.

  • Gearskin #29 1 year ago

    "Somebody who combines the professions of analyst and therapist, thus becoming an analrapist."

  • Phantom_Dynamite #30 1 year ago

    I have always said flipping a coin can be more accurate then Patcher.

    As long as the price is right and more importantly the software line-up is good PsP2 will be fine, I only had a passing intrest in 3DS then I saw the software line-up and I was genuinely excited then I heard rumors about the price and I was sad :(

  • daz_john_smith #31 1 year ago

    Here's exactly what he said, straight from the horses mouth:
    Gametrailers - Pach Attack

  • NotSoSlim #32 1 year ago

    @hobo

    62million console sales = never performed well? Take your fanboy glasses off and give Sony credit for even attempting to take on Ninty in the handheld market.

  • Ryze #33 1 year ago

    Sony are a bit late with the phone and PSP innovations in 2010, though. When did the iPhone launch again?

    I do reckon there's still a huge market for serious mobile gaming that Sony can win, but 3DS is about to be a serious competitor here.

    I'm talking online FIFA 11 mobile, Football Manager, SFIV and Fallout 3 level gameplay in the mobile space.

    If they can get people to buy the devices, and then deliver mobile network services, and impulse priced games, then it could be big.

    If not, then... best of luck to them, but I'm not an early adopter of this stuff unless it's cheap or free this time around. Got holidays to pay for.

  • redcrayon #34 1 year ago

    DS sales start to drop off after 5 years of sellling millions. Shocker.

    As for the PSP, it didn't sell as much as the DS, but it's still been astonishingly successful. To enter the market and maintain, what, 2/3rds of the sales of the dominant player? The Go (and Sony's digital pricing in general) was fairly poor, but they are well placed to learn from their mistakes. The PSP2 vs the 3DS will be an interesting scrap- my money is on the PSP2 wiping the floor with the 3DS for online, but the 3DS games lineup does look good.

    The problem is people looking at sales as either all-conquering or shit. It's possible to be a success worth building on while still not being number 1. Prime example- the Xbox.
    Edited by redcrayon at 06/12/10 @ 23:21

  • zeldasdad #35 1 year ago

    this is rubbish , i dont think people shell out 200 odd quid to play tetris on their ds or psp , they are serious gaming devices for gamers

  • carrotcake #36 1 year ago

    He is imagining the next PSP will be exactly like the first. The past doesn't exactly repeat itself... people predicted Nintendo would fail after the Gamecube, and PS3 would dominate. I'm sure Sony are aware of the same things everyone else is and they will put out something that has learned from years of being in the handheld business and relevant in the post-iPhone world.

  • zedzee #37 1 year ago

    Although I think his reference to Tetris is a generalisation that cheaper software has not only saturated the market but it's appeal of being easier on the pocket will ultimately mean that it will always be a preferred choice, I don't believe that it's simply (if you will pardon the expression) 'game over' for the likes of Sony and Nintendo.

    Nothing wrong with both of them getting their next gen handheld games strategy right by not only providing high quality games (UMD-based for the PSP2, I hope!) but also cheaper (that magic £1) region, as well as (I'm hoping) reduced costs for the SDK, to allow innovative and independent developers to get in on the act as well.

    All bets are off, as far as who comes up with the right sales model and hardware platform to deliver the content on in the future. Just because Apple has 'shown the way' for cheaper software - that the likes of Google are keen to follow - it doesn't mean that they've sown up that market segment and no one can compete.

    I think, if anything, his predictions are far too simple, whereas the actual market is getting more complex every day. Perhaps that's why it's so difficult to judge it at the moment, as it's a moving target and in complete state of flux...?

  • coolbritannia #38 1 year ago

    I think he's right, Sony think he's right, hello playstation phone.

  • vizzini #39 1 year ago

    I believe he's got it badly wrong. His comment is just really an extension of looking at the sales trends we already have, and an observation of parents buying iPhones and allowing kids limited use; kids want iPhones.

    I think that people are actually maturing in their mindset to gadgets and want more from them now. Nokia and Sony Ericsson kick started the smartphone range with the Communicator and P800; believing people would only take one device in their pocket like they do with the iPhone now, etc. But netbooks and handhelds like the DS & PSP have been slowly bucking that trend for early adopters of carrying 2 devices, and I think that is the trend that will continue.

    An ultra-portable semi-smartphone that has great battery life, great voice quality calling/reception, a basic camera, stylish and works well as a mobile broadband (bluetooth) modem is where I think mobiles are actually heading.

    That way, people can carry a secondary device (of today's smartphone form factor); that is a real portable console powerhouse (3DS/PSP2) and can tether to the ulta-portable phone; replacing the rucksack sized netbook functionality in a way the iPhone partially does, but not well enough and certainly not well enough for gaming.

    The real struggle that this twin device approach has is carrying multiple charger accessories with you; so being able to charge the phone via the portable console or its charger might be an important feature to add.

  • Typh #40 1 year ago

    This guy is probably Patcher's young brother. Try again little fella.

  • TAPNGO #41 1 year ago

    compared to the DS the PSP doesn't look good, but selling over 62 million units isn't all that bad.

  • goatjugsoup #42 1 year ago

    how on earth are these analysts even qualified to analyze anything? he obviously doesnt know what he's talking about lol tetris =/= every single handheld game, there are some games out for handhelds now that wouldn't work at all on an ipod. There is a chance though that the day will come that they will build an ipod that is capable of playing those kinds of games but even if they do, the development costs of those kinds of games wouldn't really decrease and they would cost just as much on an ipod as on a psp or ds.

  • metamorphic #43 1 year ago

    Pachter has really outdone himself with his utter stupidity. Tetris, really? Who pays this man?

  • Articulate-Troll #44 1 year ago

    So why are the ramblings of corporate Shill Michael Pachter suddenly considered news?

  • White_Waffle #45 1 year ago

    We don't know yet how the next PSP2 will exactly look like. Iphone is a mobile phone, ipad is a touch computer for surfing the web and reading and writing. the game functionality is for both one of many features and not top on the list. there are great apps/games for those devices but the limitations are the missing buttons.
    buttons make the handheld bigger, less elegant, look like a toy, but are essential to a lot of games.

  • Bravestinsane #46 1 year ago

    what the fuck are these twats paid to do exactly?

    Of course DS sales are cracking every pissing person has one already, DS, DS lite, DSi were pretty much the same device playing the same games.

    As soon as a truely new handheld comes out the sales will start booming again, this guys a retard.

  • d00dl #47 1 year ago

    I'm sure people read these articles out of curiosity about what sort of tripe these so called 'analysts' will be belching out. Does Wedbush Morgan or whatever they are called feel no embarassment when this clown opens his mouth? I suppose the company is owned by him and he is the only employee.

    I don't want to bait myself into investigating...

  • Bradach #48 1 year ago

    Yeah... Well that's just your opinion... Man

  • Beano #49 1 year ago

    "I think the PSP is dead on arrival, I think the PSP2 is dead on arrival."

    PSP has sold 60+ million units world wide - hardly DOA!

    I'm sure 3DS will be the market leader (again), but that doesn't mean there isn't room for another handheld console like the PSP2 if the games are great. Personally I don't see my iPhone as a real handheld gaming device - it needs buttons and a stick to be used for real/core games.

  • systems #50 1 year ago

    iPhone/Touch doesn't have Monster Hunter or Persona. Nuff said.

  • Dizzy #51 1 year ago

    >iPhone/Touch doesn't have Monster Hunter

    Only a matter of time.

  • Onelove1867 #52 1 year ago

    I disagree. Im no lover of handhelds, but I sure as hell want to a 3DS (although not at it's launch price). If the PSP2 takes a similar form factor to the Go (only with vastly superior support, obviously) and is as powerful as rumours suggest, then I want one of those as well.

    The older I get, the less time I have to spend sat infront of a TV to play on my PS3. The closer handheld consoles come to replicating the home console experience on the move, the more interested I am.

  • MDL199 #53 1 year ago

    This guys a twat.

  • jonsaan #54 1 year ago

    'What's the difference if you play Tetris on an iPod Touch or Tetris on a DS?'

    What a twat. There's a world of difference. I can control one version very well and the other is a bit of a mess. Probably not the best game to start making comparisons with to be honest.

    If only apple would put a dpad and a couple of buttons on the bloody thing..
    Edited by jonsaan at 07/12/10 @ 11:41

  • BuddyChrist #55 1 year ago

    If iPhone made a clip on accessory that added buttons and an analogue stick etc, they'd already be dead.

  • sega #56 1 year ago

    I've kind of avoided the iphone because I don't like the idea of buying apps. Call me a dirty pirate if you will, but I prefer a phone where I can just download emulators, ScummVM etc and put what I want on it like it's my PC and will be easily transferable to my next phone.

    Still this guy does have a point but I think it's a bit premature. For a start, kids may be happy to play on an iphone or ipad but it's not theirs - it'll be their parents. If a child has either of these than that's pretty irresponsible of the parent. With the DS and the PSP, they're safe for children to play and cheap enough to damage. The main thing is the games, however. The iphone doesn't have Mario, Zelda, Pokemon, Nintendogs, Brain Training, Gran Turismo, Little Big Planet etc - people do actually buy these machines for the games, not just to play Tetris on the move (it's not 1989!).

  • sjmlondon #57 1 year ago

    Sony will probably add some unpopular storage device to their new device like the ubiqituous UMP cards or assume everyone is quite happy to pay £30+ to download every game.

    The trend as far as I can see to towards Iphone/ Ipod Touch/ Android devices with people buying games / apps costing a couple of quid max and those games /apps selling in the millions.

    Sony's sales model is out of date, and regardless how good the device looks, it's it cheap and cheerful software that sells at pocket money prices.

  • des #58 1 year ago

    Hardware sales were never PSP problem,software on the other hand sells like shit,except in Japan...but who cares about them here

    You have more chance of winning a lottery than finding PSP games in western game charts,total disaster.
    Hardware numbers seem ok in the west,but I bet that tons of those sales are made by repeated buyers(PSP 1000,2000,3000,etc)...software and hardware sales are like night and day.
    Nobody cares about PSP games,devs would rather go bankrupt than develop for PSP.PSP2 might change that,but only with huge Sony moneyhatting.

    Oh and get Rockstar on board,PSP2 will be bought immediately(bought PSP just to play Rockstar games).
    Edited by des at 07/12/10 @ 12:42

  • moggsy #59 1 year ago

    It's a brave software house which piles millions of pounds into a handheld title these days. Better to spend less and sell for less.

    Even if the PSP2 is the best handheld device ever made it will only be as good as the software available for it. Most software houses abandoned the PSP many years ago as they weren't getting a return for their significant investment. Releases for the DS are few and far between too with Nintendo happy to still market launch titles (Brain Training etc,).

    The PSP2 will need an app store featuring lots of 59p to have any chance of success. Even then you may as well just buy an iPod Touch as it's OS is better than anything Sony are likely to come up with.
    Edited by moggsy at 07/12/10 @ 15:08

  • Gaol #60 1 year ago

    MICHAEL PACHTER >>> HE CLAIM THE CRAP

  • eddiep #61 1 year ago

    Grant Theft Auto is already on the iPod/iPad.

  • CaoSlayer #62 1 year ago

    He is missing the thing that made Nintendo de king of this generation:
    They aren't targeting kids, they are targeting their fathers.

  • Katanax #63 1 year ago

    Define handheld...

    If he means dedicated gaming devices he's probably spot on with his analysis, but portable gaming through devices which do more than simply render content is growing at a ridiculously rapid pace.

    Seems to me there's too much fragmentation of markets and no common terminology to attach to each as a differentiator. Handheld, mobile, portable, browser-based, cloud distribution... etc etc etc.

  • christotten #64 1 year ago

    You can actually get GTA on i - Chinatown looks great and the devices like iPhone can easily handle the graphics and sound as Citadel demo showed.

    The problem with playing games on iPhone is that it doesn't have a dedicated joy pad, someone should do a case/bold on for it because I have using on screen controls. Some games work fine, Plants versus Zombies being a perfect example, most that are ported (like GTA) suck, graphics-check, sound-check, control-FAIL

  • natureboy #65 1 year ago

    The problem with analyst is that thay can say anything their bosses want to hear. He has no idea of the industry and i am sure he has never played a video game console before. Take whatever these guys say with a pinch of salt

  • IronCladChicken #66 1 year ago

    Was he one of the many, many analysts that predicted that the iphone would flop becasue Apple had no prior history in the market?

  • electrolite #67 1 year ago

    Not the best timed article. Saying Itouch has made great strides into the games market is hardly a dramatic statement, while criticising PSP/DS sales is badly timed given the last released figures for PSP in Japan (770k+, best seller, before this weeks Monster Hunter release) and DS in the States (900K between 21 and 27 November). I'm not sure the guy's completely credible.

  • Phishfood #68 1 year ago

    Don't be like Gamespot were they post some stupid prediction from some self-proclaimed no-name analyst as news every other day.

  • apoc_reg #69 1 year ago

    If you have an iPad you can see clearly the near future of portable gaming!

    And they guy that mentioned persona and monster hunter you are right... last generation. If the pad/touch keep selling at this rate surely its only a matter of time before these 3rd party developers jump ship?
    Edited by apoc_reg at 04/01/11 @ 10:07