NINTENDO is launching the Wii U, a game machine designed to appeal both to the original Wii's casual audience and the hardcore gamers.

Just like the Wii U's predecessor, the Wii, which has sold nearly 100 million units worldwide since 2006, the new console's intended audience is 5 to 95," says Reggie Fils-Aime, the president of Nintendo of America, the Japanese company's US arm.

But the Wii U arrives in a new world.

Video game console sales have been falling, largely because it's been six years since a new system has launched.

Most people who wanted an Xbox 360, PlayStation 3 or a Wii already have one.

Another reason: People in the broad 5-to-95 age range have shifted their attention to games on Facebook, tablet computers and mobile phones.

US video game sales last month, including hardware, software and accessories, totalled $US755.5 million ($A733 million), according to the research firm NPD Group.

By contrast, in October 2007 the figure stood at $US1.1 billion.

The Wii U is likely to do well during the holiday season, analysts believe, so well that Christmas shoppers may face shortages.

However, the surge could peter out in 2013. The Wii U is not expected to be the juggernaut that the Wii was in its heyday, according to research firm IHS iSuppli.

Back then, the Wii outsold its competitors, the Xbox 360 and the PlayStation 3, in its first four years on sale, logging some 79 million units by the end of 2010.

By comparison, IHS expects the Wii U to sell 56.7 million in its first four years.

In the age of a million gadgets and lean wallets, the game company also faces a new challenge: convincing people that they need a new video game system rather than, say, a new iPad.

The Wii U, which starts at $US300, isn't lacking in appeal.

It allows for "asymmetrical game play," meaning two people playing the same game can have entirely different experiences depending on whether they use a new tablet-like controller called the GamePad or the traditional Wii remote.

The GamePad can also be used to play games without using a TV set, as you would on a regular tablet. And it serves as a fancy remote controller to navigate a TV-watching feature called TVii, which will be available in December.

Nintendo, known for iconic game characters such as Mario, Donkey Kong and Zelda, is expected to sell the consoles quickly in the weeks leading up to the holidays.

GameStop Corp, the world's No.1 video game retailer, said advance orders had sold out and it has nearly 500,000 people on its Wii U waitlist.

Even so, it's a "very, very crowded space in consumer electronics" this holiday season, notes Ben Bajarin, a principal analyst at Creative Strategies who covers gaming.

Apple's duo of iPads, the full-size model and a smaller version called the Mini, will be competing for shoppers' attention.

Not to be outdone, Amazon has launched a trove of Kindle tablets and e-readers in time for the holidays. These range from the Paperwhite, a touch-screen e-reader, to the Kindle Fire HD, which features a colour screen and can work with a mobile phone data plan.

Then there are the new laptops and cheaper, thinner "ultrabooks" featuring Microsoft's new Windows 8 operating system - not to mention smartphones from Apple, Samsung and other manufacturers.

The Wii U is the first major game console to launch in years but in some ways Nintendo is merely catching up with the HD trend.

Sony and Microsoft began selling their own powerful, high-definition consoles six and seven years ago, respectively. Both Sony and Microsoft are expected to unveil new game consoles in 2013.

Bajarin believes it's going to take "a little bit of time" for the Wii U's dual-screen gaming concept to sink in with people. If it proves popular, Nintendo could see even more competition at its hands.

"Technologically, it's not a leap of the imagination to see Apple, Google, Microsoft do something like this," he says.