I went to lunch with my friend Jason the other day. He’s a 30-year-old computer programmer, a photography buff, and a gadget fiend. But he's not a gamer; he's done some PC gaming in his time, but consoles have never been his cup of tea. So imagine my surprise when he turned to me and asked if he could borrow my Xbox. He wanted to see how it looked on his brand-new LCD television, a reasonable request. But his next comment floored me. "I was thinking of getting either one of those or a PSP."

Huh? What? How did this guy even know about the PSP? Why would he consider buying one? It certainly wasn’t my influence. We hang out a lot and he knows I write for PGC, but we rarely talk videogames and I can't recall ever discussing the PSP with him. I then realized the PSP's potential to attract a whole new gaming audience. Jason is exactly the demographic Sony's looking to capitalize on: guys in their late 20's and early 30's with disposable income, maybe not gamers in the past, but open to a new (and cool) gaming gadget. If non-gamers like him are considering the PSP, it looks like Sony is going to hit this demographic head-on.

So where does this leave the Nintendo DS? Shortly after its release in November 2004, it was flying off shelves so fast it looked like the PSP would never catch up. With millions of systems already in the hands of gamers, prevailing wisdom would have the DS in an unassailable position by the time the PSP launched (whenever that was). That all changed on February 3rd, 2005, when Sony announced that its portable powerhouse would ship on March 24th with 24 – yes, 24 - games to choose from. All of a sudden the DS didn't seem so invincible.

The PSP launch lineup included continuations of the popular Metal Gear, NBA Street, NFL Street, and WipeOut franchises, not to mention the fact that its 24-game roster doubled the number available for the DS at the time. Nintendo’s portable had only seen one game release in the previous two months (niche puzzler ZooKeeper), and beyond Wario Ware: Touched! there was no major software in the pipeline. Not much has changed since then, which begs the question: what can Nintendo do to counter the hype surrounding the PSP launch?

Undoubtedly the smartest move would be to announce their online plans for the DS. It's no secret the system will be online in some capacity, but the million-dollar question is when Nintendo will show their hand, and to what extent. E3 would be ideal for an announcement of this magnitude, but mid-May is too late considering the PSP will have five Internet-ready games at launch (MLB, NBA, Gretzky NHL, ATV Offroad Fury: Blazin’ Trails, and Twisted Metal: Head On). Gamers need a compelling reason to hold off on a PSP purchase, and an exciting DS online strategy could be it. Bombshell game announcements could go hand-in-hand with this news; details on how Mario Kart, Pokemon, or Animal Crossing could be played against gamers anywhere in the world would send the public into a frenzy. We’ve wanted online versions of these games for years, and this would be the ideal opportunity for Nintendo to give them to us.

It would also make sense to enhance the system’s value proposition. While the DS is positioned as a dedicated game machine, the PSP's biggest selling point is its ability to play games, movies and MP3s. To counter this Nintendo could announce a North American release for their Play-Yan accessory, a special cartridge allowing the DS to store and play ASF, MP3 and MP4 files. This would be the perfect way of saying, "Hey, the DS is meant for games, but it can do everything the PSP can if you want it to." Even if multimedia isn’t built-in, having the ability is what’s really important.

In the same vein, adding PDA capabilities to the DS would be another way of increasing its appeal. Rumors have hinted at a licensing deal for a DS version of PalmOS, but this would be a brilliant move regardless of the operating system used. It would turn the DS into a killer combination of GameBoy and PDA, allowing Nintendo to position it as a multi-purpose, customizable "lifestyle device". Coupling PDA capabilities with the Play-Yan would entice young professionals like Jason who have needs beyond gaming. The DS is competing directly with the PSP no matter what Nintendo says, and it’ll need more than just games to do that.

And exactly where are those games? Thirteen releases in three months does not a handheld juggernaut make, especially when two of them are the atrocious Ping Pals and forgettable Sprung. Super Mario 64 DS is the only "must-buy" game of the bunch, and I can attest that it's not that appealing to somebody who played through it in 1996. What's worse is that the most-anticipated DS games (Castlevania, Metroid Prime: Hunters, Mario Kart, Advance Wars, Animal Crossing) won't arrive in stores until August at the earliest. This is the price Nintendo pays for announcing and releasing a system in the same calendar year; it's obvious that Sony's lineup is more polished and well-rounded, clearly the result of longer development cycles all around.

Nintendo's best shot at damage control is to give exposure to games that demonstrate the DS’s unique abilities. Show off titles like Feel the Magic XY:XX, Wario Ware: Touched!, Spider-Man 2, Pokemon Dash!, and Yoshi's Touch & Go. All of these feature game play available only on Nintendo DS, and they’re different enough to intrigue those deciding between the DS and PSP. Nintendo could also use Sony's tactics against them by getting the hype machine rolling well in advance of the DS’s fall lineup; if gamers know upcoming releases like Animal Crossing and Mario Kart are going to rock, they'll be more willing to buy a DS and wait out the dry spell instead of opting for a PSP.

The DS's price advantage must be capitalized on as well. Parents thinking the DS is expensive at $150 will find the PSP's $250 price tag downright ludicrous (let alone the $400 launch bundles many retail outlets are forcing on customers). It’s also hard to imagine any parent being willing to put a $250 handheld with a delicate LCD screen into the palms of a 10-year-old. Granted this age group isn't the market that Sony's trying to capture, but you know kids are going to want the PSP. Will their parents be able to afford it? Probably not. Nintendo really needs to play up this fact. I can see the press release now: "Nintendo DS Offers the Best in Portable Gaming for $100 Less than the Competition!" Including a pack-in game (maybe Wario Ware: Touched!) would make the DS the deal of the century. The sales spike resulting from the GameCube’s drop to $99 shows that price really does matter, and Nintendo would be wise to take advantage.

Of course, Nintendo could go their usual route and offer the DS in new colors. Japan has already seen a blue-and-white "Pepsi Edition", and the celebrity auction of artistically customized DS systems was very popular this past January. New colors would generate press coverage and revitalize interest in the platform, attracting DS fans who have been waiting for something other than Platinum. It’s often considered a "cheap" way to reinvent a product, but it works. The Zelda and NES Edition GBA SPs were big hits, giving Nintendo fanatics one more thing to collect. No matter what you think of the tactic, I guarantee you’d consider buying a Zelda Edition DS (I know I would). With this in mind, an announcement of this sort near the end of March is a virtual certainty.

Clearly, Nintendo has a choice – actually, lots of them. They can continue being conservative and do what everybody expects (hype their price advantage, announce some new colors, maybe bundle a game), or they can launch an all-out assault on Sony and their PSP (announce an online strategy, Internet-ready games, PDA capabilities, or a North American Play-Yan). Nintendo has the opportunity to make Sony's big day their own - the choice is theirs.

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