Microsoft's portable...

[Paco]

Woah, multiple post insanity.

Were Microsoft to enter the handheld market the likely outcome is that it would fracture the PSP fanbase, producing lower sales for each and leaving Nintendo relatively high and dry given the DS's wildly different approach. Yes the market is growing somewhat, but can it support a market that's already filled by[Apple, Sony, Nintendo, and several smaller competitors that show little or no sign of going anywhere [the big companies at least]. Not to mention that MS needs to make their home console a success and splitting their time, money, and effort between the 360 and a super advanced handheld simply isn't the way to go about it.

Music/Video portable device isn't the same thing as a video game console.

If it were only a music/video player then I don't think it would touch the PSP, but rather has the possibility to get some of iPod's share. (The PSP just doesn't compare to the iPod, imo, and I don't think it cuts into Apple's market share at all).

It really depends on how they go about it. If they keep games out of the equation then they have a much bigger audience to go after and the possibilty to establish a good brand. It could be the new "it" when people "get over" the iPod's cool factor or if they make something better (which nobody else seems to be able to do. Apple is leading the MP3 player market in technology, and everyone else seems to be two steps behind.) If they do take the game route out of the gate then they stand much less a chance of success because of the DS and PSP.

Growing somewhat? LOL. It's grown by leaps the past few years and it's still growing.