Company Town : Nintendo Says It’s Back on Path to the Top With New ‘Donkey’ : Software: Chairman tells conventioneers that the company, ‘a little bit humbled,’ will be No. 1 again by year’s end.

Armed with new technology and a new version of its early-1980s hit game “Donkey Kong,” Nintendo of America predicted Thursday that it will regain the market share dominance--which it recently lost for the first time to Sega of America--by the end of this Christmas season.

In a keynote address at the Consumer Electronics Show, Nintendo Chairman Howard Lincoln said the company was “a little bit humbled.” Lincoln also toned down the competitive rhetoric that has included public insults and nursery rhyme taunts. He praised Sega for having “great games and excellent marketing,” reserving his more pointed remarks for the faltering start-up that got all the limelight at last year’s convention: 3DO Co.

3DO Chairman “Trip Hawkins has made a career out of bad-mouthing Nintendo and Sega and everybody else in the video game business for a number of years, and now the marketplace has given him his comeuppance,” Lincoln said later in an interview. “Quite frankly, I think a lot of people in our industry are having a big chuckle--including me.”

Answered Hawkins: “3DO has obviously touched a nerve; maybe that’s why Howard’s on the defensive.” Hawkins noted that sales of the 3DO game machine have accelerated in the last three months as more software becomes available. “I think deep down inside Nintendo is scared to death.”

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Sega declined to set up a booth on the convention floor this year, but the company did throw a party Wednesday night, where Chief Executive Tom Kalinske announced that his firm--whose philosophy has always been to use game software to drive sales of its proprietary game consoles--will start distributing games for personal computer CD-ROM drives.

Palo Alto’s Rocket Science Games, whose first titles are due out this fall, will be the first company distributed by Sega.

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Contrary to popular belief and Walt Disney Co. Chairman Michael D. Eisner’s own technophobic pronouncements, it turns out that Disney is, in fact, a technology company. The convention hall is crawling with Disney executives, who made two technology-related announcements Thursday and plan another this morning.

Disney Studios Chairman Jeffrey Katzenberg showed off “Mickey Mania: The Timeless Adventures of Mickey Mouse” a CD-ROM game that Disney Software co-developed with Sony’s Imagesoft division. While the company’s closely guarded flag bearer has been in video games before, this is the first time old animated footage from shorts such as “Steamboat Willie” and “The Prince and the Pauper” have been translated to the interactive realm.

Later, Eisner announced a new exhibition at the company’s Florida Epcot Center that will showcase new technology.

“Most of our audience is not going to be traveling in space, at least for the next 20 years, so we thought it was time to focus on the nearer term,” Eisner said. “We are very technologically driven, but only as it enhances the value of entertainment. Besides, whatever I say last week I disavow anyway.”