Nintendo Co. Ltd. said on Tuesday it would establish 1,000 WiFi hotspots in Japan by the end of 2005 where owners of its DS portable game machines can play games with others online for free.

The company is planning a similar service for overseas markets, aiming to expand sales of the DS and protect its leading position in the handheld game console industry from Sony Corp, which recently launched its own handheld machine.

I have yet to play anyone head-to-head on either my DS or PSP so I don’t know how vital online gaming is for handhelds, but having specific hotspots for the DS could be a bad thing. Why not just allow any wireless network to connect?

If Sony can get an online networking system setup for the PSP they may very well take major chunks out of Nintendo’s handheld marketshare.

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