Ailing Firms Look to New Products for Salvation

On the eve of the Electronic Entertainment Exposition’s opening at the Los Angeles Convention Center, two troubled companies, Apple Computer and Nintendo, announced new technology Wednesday that they hope will help set them on the road to salvation.

Nintendo said at a news conference that its long-delayed video game machine, the Nintendo 64, will be available September 30 for $249.95. However, the company said it would have only 500,000 machines available to ship before Christmas.

With Nintendo planning to spend $50 million to market the system and the enthusiastic reception for the system among game reviewers, there are likely to be long waits for the machine.

There was frequent applause during a demonstration of Nintendo’s flagship game, Mario 64, as the new Mario, remade in 3-D, did a triple somersault, swam, turned semitransparent and then fell splat falling from a towering cliff.

“It’s a stunning machine,” said Bryan Carter, a game reviewer and coeditor of Game Zero, an online gaming magazine, who flew in from Phoenix for E3.

Separately, in a small booth modeled after a living room, Apple Computer demonstrated a device it hopes will create a new category of “information appliances” that are cheaper than computers but more sophisticated and versatile than game machines.

The device, which can play CD-ROM titles and browse the net, will be marketed this fall by Japanese game manufacturer Bandai for about $500. The machine has been available in Japan since April.

The device--which Apple calls a “Net browser”--uses Apple’s Pippin software, a derivative of the company’s Macintosh operating system.

The net browser includes a modem that can be used for accessing the World Wide Web and a CD-ROM drive. To keep the price down, the device is designed to be connected to a television set and contains no floppy or hard disc drive. It is operated using a remote terminal that looks much like a Sega or Nintendo game controller. A keyboard can be added, but the system includes an on-screen alphabet board for typing out simple words.

“We’d like people to think of this as the Model T of the information world,” said Satjiv S. Chahil, senior vice president at Apple. With personal computers still costly, Chahil believes the PC is unlikely to penetrate more than 30% to 40% of all households.

“Interest in the Internet and the World Wide Web is high, but $1,500 isn’t within everybody’s reach,” Chahil said. “The VCR was for professional use at $1,500, and only when it came down to under $500 was it cheap enough for all of us.”

Apple hopes to license its Pippin software to a large number of manufacturers, but so far has only found one taker in Bandai. Analysts are skeptical of how well the system will do given the broad range of computer and game platforms already on the market.

The Pippin machine, however, could be the first in the market of the so-called network computers widely touted as a new genre of machine by Oracle Chief Executive Larry Ellison.