The Japanese computer games giant Nintendo today announced an April 3 launch date and a price of “around £149” for its latest handheld games console, the Nintendo DSi. Just one year ago, before the collapse of sterling, it might have cost one third less.

The DSi is the company’s latest refinement of its phenomenally successful DS console, which has sold over 98 million units since its launch in late 2004, 9 million of them in the UK alone.

The first DS was a chunky-looking toy aimed at the children’s market. It sold well, but when Nintendo redesigned the machine in 2005, with a sleeker look and a new program, Dr Kawashima’s Brain Training, its popularity spread to adults, too. Brain Training has now sold over 17 million copies worldwide.

Superficially, the new machine – a little smaller, a little slimmer -- looks very similar to the DS Lite, although Nintendo is at pains to point out that this upgrade is far greater than the one from DS to DS Lite.

New on the outside of the DSi are a pair of low-resolution cameras, one facing in, one out, an SD card slot for reading memory cards containing music and photos, and slightly larger dual screens. Internally, the machine will have a faster processor and 256MB of storage space, where games and programs downloaded from the DSi Shop can be saved. The DSi Shop will launch at around the same time as the console, with more details to come in late March.

Fans of the existing DS Lite are more likely, however, to notice what’s missing on the new machine. Gone is the slot that can be used to play older games from Nintendo’s earlier GBA console. Also, for the first time, the machines will be region-coded, like DVD players. Previously, any DS bought anywhere in the world could be made to work in a variety of languages, and would play any DS game from any country.

This has led to online piracy that is thought to have cost Nintendo millions in lost revenue. Company officials say that the new machine will contain an operating system that can be upgraded through the machine’s wireless internet connection. So, when the pirates crack one set of codes, Nintendo can rewrite the rules. Region coding will apply only to titles specifically designed for the DSi.

But the biggest source of controversy in the UK for the new machine will surely be its price. In Japan, the DSi retails for just under 20,000 yen. One year ago, exchange rates of around 200 yen to the pound would have suggested a price of just over £100. Now, with the yen at 134 to the pound, Nintendo has set the price at a level only £30 below that of its domestic console, the Wii.

Unlike its competitors Sony and Microsoft, Nintendo never sells any of its hardware at a loss. Even David Yarnton, the general manager of Nintendo UK, seems resigned, rather than bullish about the UK pricing. “There’s a certain amount of pressure there,” he told The Times. “But every company that’s Japanese-based is in a similar situation. I think you’ll see other Japanese products going up before long.”

For the moment, other foreign technology companies are holding back on UK price rises to reflect the weakness of the pound. Crucially, the DSi will be less than £20 cheaper than the base-model Apple iPod Touch, which many industry observers now see as the main threat to Nintendo’s dominance of handheld gaming. Although the base model iPod Touch does not have a camera, it does have 8GB of storage, a bigger touch-sensitive screen than the DSi, and it can play films, games and music in a variety of formats. The DSi will only play music in AAC format, rather than the more popular MP3.

Apple’s online download store now accounts for over 14 per cent of all mobile game downloads, according to figures released in early February by the market research group comScore. Games for Apple’s touch applications typically cost no more than £2.99, some £20 less than Nintendo charges for DS titles.

Despite all of these hurdles, some industry experts are still predicting great things for the new baby Nintendo. Michael French, the Editor in Chief of the games industry trade publication MCV, told The Times: “This is a great-looking piece of kit. It may not do everything, but you have to remember that this is a games machine, not a lifestyle product. If Nintendo creates its own software and allows others to do the same via the online shop, I can really imagine this taking off.”

Nintendo will continue to sell the existing DS Lite, alongside the new DSi.