Nintendo aims to zap its rivals with speedy console

Nintendo announced plans this week to zap rivals with a speedy new games console powered by an IBM microchip and disks supplied by Matsushita Electric Industrial Co Ltd.

Nintendo, second in the lucrative games console market after Sony which makes the Playstation, said it would release the fast next-generation game machine at the end of 2000.

"We are preparing to launch full-scale sales around the world at about the end of the year 2000," Nintendo president Mr Hiroshi Yamauchi told a news conference in Tokyo.

The companies released specifications showing that the console will be powered by a 400 megahertz IBM custom processor chip, making it faster than Sony's planned Playstation II which is to run with a 300 megahertz central processing chip.

"Matsushita will develop and supply the DVD media and the drive devices for the next-generation Nintendo game machine," the statement said.

The new Nintendo plan gives the company the backing of heavyweights Matsushita Electric and the US's International Business Machines (IBM) to take on the might of Sony.

"With the 2000s in perspective, we have gathered the world's best technologies for designing Nintendo's next-generation machine," the statement said.

The New York Times earlier quoted "people close to the deal" with IBM as saying that it was worth $1 billion (€926 million) and that the new machine would be released in the second half of 2000.

"Nintendo cannot penetrate the adult users' market of the 20 and 30-year-olds which is for computer graphic-oriented games," said ABN Amro analyst Mr Hironobu Sawake

But Sony's Playstation II will be introduced this fiscal year, he added. "Everybody knows that the specs are very high. Users will be able to enjoy high-quality computer graphics."

Later this month Nintendo is reportedly expected to report group net profits rose by 1.6 per cent in the year to March to 85 billion yen (€669 billion).

Earnings were helped by strong sales of its computer game software for the Nintendo 64 console machines and for portable Gameboy consoles, both in the domestic and the US markets, said a report in the Nihon Keizai last month.

Sony last month unveiled plans for the PlayStation II game console with a powerful new microchip, warning it will be a "major challenge" to giants Microsoft Corp. and Intel Corp.