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In a blow for holiday video game sales, Nintendo said it would delay the launch its 3DS handheld video game system until February, dashing hopes that the highly anticipated product would be on store shelves this holiday season.

The company also cut its forecast by more than half due to the stronger yen and the delayed 3DS, which lets users see stereoscopic 3D images without requiring them to wear 3D glasses. The system was rated the most-anticipated new product by most press at the E3 game conference in June, when Nintendo CEO Satoru Iwata, pictured, first talked about it.

Missing the holidays is a big deal, since 40 percent of sales in the game industry occur in the fourth quarter. The delay will leave Nintendo vulnerable to rivals such as Apple, Microsoft and Sony. The Apple iPhone, iPod Touch, and iPad have grown at such spectacular rates that many believe is coming at the expense of the Nintendo DS, originally launched in 2004. Nintendo’s 3DS is aimed at breathing new life into the DS market.

Nintendo was also expected to play a big role in helping the video game market recover. Year to date sales are down 8 percent in the U.S. video game market, according to market researcher NPD. That’s largely because Nintendo’s DS and Wii game console have seen poor sales this year compared to last year. Nintendo’s top sales executive, Cammie Dunaway, resigned last week to take a job outside the game industry.


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Meanwhile, Microsoft and Sony will likely breathe sighs of relief. The Sony PlayStation Move motion-control system for the PlayStation 3 went on sale last week, while Microsoft will launch its Kinect motion control system in November.

Nintendo now plans to launch the 3DS on Feb. 26 in Japan for 25,000 yen, or about $297. The system will debut at undisclosed prices in the U.S. and Europe in March.

Nintendo had previously only said it planned to launch the 3DS by March, 2011, but many in the industry had hoped that it would launch in at least one territory this fall. For the fiscal year that ends in March, Nintendo now expects a profit of 90 billion yen, less than half of the 200 billion yen it expected earlier. And it will post a 2 billion yen loss for the six months ending Sept. 30, compared with 70 billion yen it had previously forecast.

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