Category Killer: Will iPhone Be Death of Gaming Devices?

With its 130,000 available apps, built-in camera and GPS capabilities, the iPhone sits squarely at the center of convergence. There's little question that the iPhone has taken a bite out of sales of some standalone devices, notably navigation units and cheap cameras.

But Sony Computer Entertainment claims it has turned the tables on the iPhone in the iPhone's core gaming market: People purchase the iPhone, enjoy certain games, and then get a Sony PSP to play it more fully. The iPhone has become an on-ramp to Sony PSP sales, a Sony executive says.

[ iPhone apps have put five markets under siege, reports CIO.com. | Check out the gaming death match between the iPhone and the Sony PSP. ]

"We've seen a significant number of co-iPhone and PSP owners," says John Koller, director of hardware marketing at Sony Computer Entertainment. "We don't view the iPhone negatively in our sector. There's been more positive impact, in terms of attention turned to the handheld sector and the ability for consumers to graduate to PSP after playing iPhone games."

Just look at Electronic Arts Madden NFL 10, the popular football game named after the legendary coach and television commentator, Koller says. The 110 MB Madden NFL 10 was one of the top games on the iPhone deck when it came out on the iPhone for the first time last fall for $10 (now selling for $7), whereas the 1.3 GB Madden NFL 10 for the Sony PSP costs around $40.

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