Vita: Don't Cry for Me, Sony Gamers

A week after Valentine's Day, Sony (NYS: SNE) is going to be a heartbreaker.

The Japanese consumer electronics giant has finally announced a release date for its Vita handheld gaming system outside of Japan. PlayStation Vita will hit stores in the United States and Europe on Feb. 22, two months after debuting in its home country.

It won't matter. This gizmo's toast.

Bumping the portable device into 2012 apparently wasn't enough time to convince Sony to correct some of the Vita's obvious shortcomings. It's sticking to the $250 price -- and $300 for the unit that adds AT&T (NYS: T) connectivity to the original's Wi-Fi capabilities. Sony is still trying to push its costly proprietary memory over cheaper and more accessible SD cards.

Sony seems to be ignoring that Nintendo (OTC: NTDOY.PK) had to slash its way out of its original $250 price for the 3DS this summer, and it's not as if even the new $170 price point will be enough. The late February release also knocks Sony out of this year's potent holiday shopping season. Vita will now have to wait 14 months for a shot at being a hot item during next year's gifting season, and it's not as if the trend away from dedicated handheld gaming systems will improve in that time.

The Vita is slick, building on the form factor of Sony's original PSP but beefing up the specs and introducing a five-inch touchscreen to roll with features that smartphone and tablet owners have come to expect. However, it's those same smartphones and tablets -- which educated consumers on the merits of multi-touch displays -- that are eating at the portable empires of Nintendo and Sony.

There's a reason that Microsoft (NAS: MSFT) has never entered into this niche, despite its recent Xbox 360 dominance on the console front. It could have easily transformed its doomed Zune line into the third handheld gaming standard, but realizes that this is Apple's (NAS: AAPL) world now.

Gamers will laugh at that. How dare anyone compare Angry Birds or Bejeweled to the rich gaming experiences provided by stand-alone handhelds? However, the industry's faltering ways -- and the battered share prices of Nintendo and Sony -- in recent years do point to a disconnect. Diehard gamers are loyal, but they're not enough. The mass market of casual gamers has moved on to "good enough" gaming on "good enough" handheld computing gadgetry.

This doesn't mean that there won't be a handful of gamers lining up at GameStop (NYS: GME) to pick up their preorders in four months. However, no one should be surprised if the $250 Vita drops below $200 a few months later -- if not dropping out entirely a couple of years after that.

If you want to see whether the gaming giant can battle its way out of this mess, addSonyto My Watchlist to track news as it happens.

At the time thisarticle was published The Motley Fool owns shares of Apple, Microsoft, and GameStop.Motley Fool newsletter serviceshave recommended buying shares of AT&T, Nintendo, Microsoft, and Apple.Motley Fool newsletter serviceshave recommended writing covered calls in GameStop; creating a bull call spread position in Microsoft; and creating a bull call spread position in Apple. Try any of our Foolish newsletter servicesfree for 30 days. We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.Longtime Fool contributor Rick Munarriz calls them as he sees them. He does not own shares in any of the stocks in this story. Rick is also part of theRule Breakersnewsletter research team, seeking out tomorrow's ultimate growth stocks a day early.

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