Nintendo speaks on next-generation plans (Reuters)

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Japanese video game maker Nintendo Co Ltd said on Tuesday it would launch a next-generation home console in 2005 or 2006 and denied a newspaper report that it would delay development of a successor to its GameCube console.

The Nihon Keizai business daily said Nintendo would delay the launch of a next-generation game machine, but the Kyoto-based company said development of the next version of the GameCube was proceeding as planned.

"Other companies aren't expected to come out with next-generation consoles until late 2005 or 2006," said Nintendo spokesman Yasuhiro Minagawa. "Our machine will be ready at the same time as the other new consoles."

On the news of a possible delay in development, Nintendo shares fell 2.67 percent to 9,850 yen in early afternoon trade against a 0.62 percent fall in the Nikkei average.

Analysts say that in developing a next-generation game machine, Nintendo will stick to its credo that video games should be fun, in part to differentiate its product from muscular consoles expected from rivals Sony Corp. and Microsoft Corp.

Last month, Nintendo announced plans to launch later this year a new, portable video game system, codenamed "Nintendo DS," that would feature two liquid crystal display (LCD) screens, one above the other.

Analysts expect the Nintendo DS to be priced well under $200.

Nintendo President Satoru Iwata has said on numerous occasions that the video game industry has started to alienate fans by developing games that are too complex and too heavily dependent on graphics.

That is why the company remains wary of a big outlay for semiconductor investment for the successor to the GameCube.

Sony is developing a high-powered processor, codenamed "Cell," to power the latest version of its PlayStation series, while Microsoft plans to use three powerful 64-bit microprocessors from IBM in the next version of its Xbox console.

Sony plans to invest 120 billion yen ($1.14 billion) in the business year starting April 1 to upgrade production lines at its factories and at the manufacturing facilities of Toshiba Corp and IBM for next-generation semiconductors, including "Cell."

The company also said it plans a new peripheral device for the GameCube, but Nintendo's Minagawa declined to comment on what the new "adaptor" would be.