Game controllers steal console spotlight (Reuters)

LOS ANGELES (Reuters) - Once considered an after-thought toeye-popping video game graphics, console hand controllerscommanded center stage this week at the game industry's annualexpo and opened the door for a new age of interactive gaming.

Nintendo Co. Ltd.'s (7974.OS) Wii console and Sony Corp.'s(6758.T) PlayStation 3 will come to market later this year withnew motion-sensitive controllers, allowing a player to swingand tilt a controller to trigger on-screen action.

"The innovation in controllers is what I would view as oneof the most important changes in the video game industry," saidRobert Kotick, chief executive of U.S. video game publisherActivision Inc. (Nasdaq: - )

Microsoft Corp.'s (Nasdaq: - ) 360 game console came tomarket last November, delivering high-definition graphics andonline game play but without a motion-sensing controller.

Nintendo's Wii controller, shaped like a TV remote control,allows a player to smash serves and hit topspin forehands in avirtual tennis match with a built-in speaker in the controllerto offer both the vibration and sound of hitting the ball.

A player can use one controller or two in order to fend offan enemy with nunchucks or act like a symphony conductor bywaving the controller to alter the pace of music.

Sony's PS3 controller, similar in size and shape to that ofthe , employs a six-way sensing system to capturemotion, but some analysts said the sensor technology did notappear as sophisticated as that of the Wii.

"It was a bit of a knee-jerk reaction in response toNintendo's controller," said Michael Goodman, analyst at theYankee Group.

The new controllers could unleash the creativity of gamedevelopers and provide Nintendo and Sony with the ammunition tocut into the early advantage of Microsoft Corp's (MSFT.O) Xbox360 game console, industry watchers said.

"Many developers will opt to make games for the PS3 and theWii and will not make the same game for the Xbox 360, givingSony and Nintendo a content advantage over Microsoft," WedbushMorgan Securities analyst Michael Pachter wrote in a note toclients.

Microsoft, which aims to have 10 million Xbox 360 consolesin the market before Sony and Nintendo debuts, offers awireless Xbox 360 controller that is lighter than the one forthe original Xbox.

Company executives said it sold a similar motion-sensingcontroller in the past, but there were not many software titlesto support it.

"If somebody is telling me that they won't develop for a 10million installed base ... then they don't understand thebusiness economics of this industry," said Peter Moore, thehead of Microsoft's game business.

Activision's Kotick said the new controllers may spursomeone who owns more than one console to buy the same game fordifferent machines, because the game play for each platformwill be so unique.

(Additional reporting by Kemp Powers and Lisa Baertlein)

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