As we expected, Apple's "Let's Rock" event yesterday offered some new iPods and a new version of iTunes—even if the unveiling didn't quite meet our expectations. But Steve Jobs and Co. had something else to deliver as well: a clear message that his company now has its sights set directly on the portable gaming market, with very real and very high aspirations for App Store games for the iPhone and iPod Touch. Jobs even showed off a new ad touting the new iPod Touch as the "funnest" iPod ever.

Apple's mobile gaming goals go far beyond fancy new versions of Bejeweled and Tetris—Jobs yesterday called for "a whole new class of games." It's now clear that the company is gunning for the big boys: Nintendo and Sony, whose DS and PSP platforms, respectively, have dominated the portable video-game market for years. Here's why the old giants should be scared of the new kid on the block—and why they shouldn't.


3 Reasons Nintendo and Sony Are Running Scared:


1. Buying iPhone/iPod Games Is Quick and Simple
Because games can be purchased directly on your iPhone or iPod Touch via Wi-Fi or the phone's 3G network, it's easy to overdo it. Psychologically, pressing "Install" just isn't the same as plopping down a few bills at your local GameStop, so a spend-happy gamer may be likely to buy three or four games in a binge. And because iPhone and iPod users can buy games anytime, anywhere, they never have to worry about stock shortages—or ever getting up from their couch.

2. iPod Games Are Cheap, and Increasingly High-Profile
Very, very few iPhone/iPod games cost more than $10. Meanwhile, very few Nintendo DS or PSP games cost less than $25. And while the DS and PSP games are usually big-budget affairs that dwarf a simple iPhone Sudoku application, this gap is rapidly closing as high-profile developers increasingly port big games such as Spore and Need For Speed to the iPhone and iPod.

3. iPod Games Can Be Expanded and Updated
It's almost inevitable that a big game will have a few bugs or glitches that aren't discovered until after launch. There's usually little Nintendo DS and PSP players can do other than grin and deal with the glitchy gameplay. But iPod games can be tuned to check for updates and heal themselves whenever bugs are found. The iPhone 3G makes it especially easy for developers to deliver expansion packs, adding levels and characters to successful games.


3 Reasons the Gaming Companies Can Sleep Easy ... for Now:


1. iPods Are Touchscreen-Only
In some ways, the absence of a keypad is a boon to innovation when it comes to mobile gaming—it encourages developers to think up creative workarounds using simple tilts and touch gestures. But it's not perfect. This is true for both big, complex games (there's a reason the touchscreen DS also has a full keypad), and with the retro/classic gaming that mobile platforms traditionally excel at (we'll never get used to tilting our phone to manipulate Tetris blocks, and Space Invaders just isn't the same if you can't properly mash your fingers against buttons). Finally, buttons are still far more precise than Apple's accelerometer.

2. Parents Won't Buy iPhones For Their Kids
The Nintendo DS costs just $129. The PSP? $169. These relatively low prices make them very attractive to parents out shopping for an electronic babysitter. Not only do the iPhone and iPod Touch cost considerably more, but they simply aren't toys that can be thrown into the hands of young children. They have large, fragile glass touchscreens, no restrictions on Internet browsing and come linked to online stores. To the extent that gaming is for children, Apple hasn't figured out how to corner the market yet.

3. Games for Dedicated Systems are Much Bigger.
It's hard to ignore that even the high-profile iPhone/iPod games are pretty stripped down, usually playing like drawn-out mini-games that rely on one or two touchscreen-, or accelerometer-driven gimmicks. No matter how pretty a game is, if the gameplay just involves tilting the screen left and right, you won't play it for long. Dedicated gaming systems typically feature more complex games with stylistically different levels and elements. On the other hand, too many big applications will just slow the iPod Touch and iPhone down. Lets put it this way: The Grand Theft Auto series soared on the PSP, but will likely never come to the iPhone (and we're not so sure we'd want to play it if it did).