This time, though, the competition from other devices is tougher.
The handheld 3DS, which goes on sale in the U.S. today for $250, lets users play 3-D games without wearing special glasses. It also takes 3-D photos. This summer, the 3DS will play 3-D movies streamed from Netflix on its 3.5-inch screen.
Reggie Fils-Aime, the president of Nintendo's U.S. arm, calls it "the first mass-market 3-D device."
Nintendo's handheld gaming systems have been wildly popular since the days of the Game Boy, but in recent years people have grown accustomed (and sometimes addicted) to playing games on their smartphones. "Angry Birds," for example, is played by 40 million people a month.
And both AT&T Inc. and Sprint Nextel Corp. have announced they'll be selling smartphones with 3-D screens soon.
Fils-Aime acknowledges that consumers have a wide range of entertainment options. Nintendo, he says, must provide better entertainment experiences so that people keep flocking to its games and devices.
So far, they are. While demand for the handheld DS has slowed over the past year, video game analyst Jesse Divnich of Electronic Entertainment Design and Research said that's only because people have been holding out for the 3DS. As of Dec. 31, Nintendo had sold about 145 million units of the DS in all its iterations worldwide. Divnich thinks demand for the 3DS will be more brisk during its first year on sale than for previous iterations, such as the DSi, which went on sale in 2008.
The Wii, which hit store shelves in 2006 for $250 (it is now $200), was often sold out or in short supply as recently as last February. It's not clear yet whether this will be the case with 3DS, but retailers say demand has been strong based on the number of pre-orders they received. Tony Bartel, the president of GameStop Corp., the world's largest video game store chain, said the company is "working every day with Nintendo" to ensure that they can meet demand.
Wedbush Morgan analyst Michael Pachter said Nintendo will sell "as many as they can make" over the next 12 months. While the earthquake and tsunami that devastated Japan will likely affect supplies, he called an estimate of 16 million units "very fair."
The 3DS isn't Nintendo's first foray into 3-D gaming. In 1995, it launched the Virtual Boy, which required bulky headgear and displayed all images in red. It bombed and Nintendo soon discontinued it. But it didn't give up on 3-D.
The technology used to create 3-D images on the 3DS is not new. Called a "parallax barrier" LCD screen, it works as if two sets of thin blinds were laid over the screen, so that your eyes each see a different version of the image. Your brain then puts them together, creating the 3-D effect. Because it only works if the viewer is at a certain place in relation to the screen, this technology is better suited to hand-held devices than TV sets.
As entertainment technology, 3-D doesn't have a long track record of appeal to the mass market. It's been possible to play computer games in 3-D for years, with the help of glasses, but they have never caught on. People are willing to pay extra to see 3-D movies, but they haven't helped overall box office receipts.
Veteran game designer Hideki Konno, who helped develop the 3DS, said being able to see games in 3-D makes it easier to comprehend distances while playing.
"You will find it easier to grasp the width, height and the depth of the gaming world," he said in an email message translated from the Japanese.
Ji Soo Yim, 20, is a fan of Nintendo but she said she might wait to buy the 3DS. She tried it out recently at the Nintendo World store in New York City while visiting on spring break from Grinnell, Iowa.
"It was supposed to be 3-D, but it looks like it's going to be a headache," she said.
Nintendo notes that the 3-D effect is adjustable (and can be turned off completely, too), which could help those prone to headaches from 3-D. Nintendo hopes that, along with the lack of glasses, will make the 3DS appealing to a broad range of people.
It also helps that people are familiar with 3-D technology from movies. Ross Rubin, an analyst for market research firm NPD Group, thinks consumers will eventually adopt 3-D TVs in their homes just as they bought high-definition screens. The 3DS is one sign that the use of 3-D is spreading through the electronics industry, he said, though he noted that 3-D TV sales haven't been as strong as some manufacturers have expected.