Last week at the Electronic Entertainment Expo (E3), Nintendo revealed a new portable gaming system called the 3DS capable of displaying 3D images without the need for special glasses. Although the current generation of 3D technology can, when paired with the right material (see Avatar), dazzle the eyes and add depth to the viewing experience, it remains limited by the need for glasses. The bulky and unattractive eye-wear is considered by many, to be the single greatest barrier to the widespread adoption of 3D technology.

The cutting edge technology powering this new breed of three dimensional display holds the potential to dramatically alter, not only the portable gaming landscape, but the hand held electronics market as well. Devices that use small LCD displays, like cell phones, portable media players and digital cameras are all primed for a three dimensional upgrade.

Despite being the first company to come to market in the U.S. with a device that uses the new 3D tech, Nintendo's singular focus on a relatively minute slice of the overall mobile electronics market may hinder them in the long run.

Current cell phones are more than capable of playing the latest graphic intensive games released today in addition to doing a whole lot more. As smart phones begin to grow as a percentage of all cellphones, consumers will begin to tire of carrying more than one device.

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As big as this news seems, it pales in comparison to the launch of Apple's iPhone 4. Twitter, Facebook, and Blog's all lit up when the phone was announced and as the phone went on sale last week. As the phone launches in real life on Thursday, these outlets will again be consumed with buzz about the new product.

In contrast, Nintendo's announcement wasn't as hyped. Like Apple, Nintendo kept strict control over the release of any information related to the device, attempting to feed into the cycle of hype and widespread speculation running rampant on the gamer blogosphere. Unlike Apple, Nintendo's hand held gaming device doesn't cut across a wide spectrum of consumers.  So, while gamers and techies were very hyped, the average consumer may not have even known the announcement was made.

(However, this should be a big seller at Christmas.)

So, is it a device issue or segment issue? I don't know the answer to that, however, I do know that if Nintendo wants to continue growth in the hand held market they should probably partner with a cellular device maker for a future release. Who wouldn't want to watch 3-D movies on their cellphone? Right?