"Making portable devices would mean having to compete directly with mobile phones. We couldn't offer devices with the same capabilities and price," said Kenichi Fukunaga, a senior director for Sony Computer Entertainment, in March.Nintendo, however, is unswaying in its desire to push out its new product to older teenagers ­ the people who probably originally used (if not bought) the first model of Nintendo Gameboy, introduced 11 years ago. "We are putting a 50m euro (£31m) investment behind it in Europe," said David Gosen, managing director of Nintendo Europe "It's for anybody who loves to play great games, really. It's about entertainment on the move."The £80 Advance has a colour screen like its predecessor, the Gameboy Colour, but larger and clearer, as well as a 32-bit processor ­ a huge contrast to the 8-bit processor and small black-and-white screen of the original version, which has sold 120 million worldwide.But the rise in mobile phones, which almost all come with built-in games, plus the promise that within a year users can download new games via the next generation of handsets, leave some doubtful about the space left for handhelds.That is because Nintendo, in the same way as other console companies, relies on the sales of the games for its consoles to make its products profitable. Margins are razor-thin on most consoles ­ and often the boxes are sold at a loss.Derek Wright, who runs Techtoyz.co.uk, a website for eager gamers who want to buy the new Gameboy ahead of time, says that "there's been no hype over here, so few advance sales ­ perhaps 40".He notes that sales of games to go with the Advance have been slow in Japan, where it was launched in March. "The ratio of games sold per console is about 1.25 to 1 ­ five games for every four consoles," he said.

"That would mean Nintendo isn't making much money on it so far." He does think the product will eventually do "very very well" among dedicated games players.Last year the Finnish mobile phone company Nokia sold 128 million handsets, each with a number of games thrown in. Nintendo 10 years to amass that total in sales of Game Boys.. When every day seems to bring news of more large-scale lay-offs by one of the titans of the New Economy, and America shed nearly a quarter of a million jobs last month, it is hard to remember last year's euphoria about the growth potential of new technologies. When every day seems to bring news of more large-scale lay-offs by one of the titans of the New Economy, and America shed nearly a quarter of a million jobs last month, it is hard to remember last year's euphoria about the growth potential of new technologies. But the pendulum of opinion is now swinging too far the other way because of the downturn in the business cycle. There are two things it's worth remembering about technology and growth. One is that in the very long run, although investment in physical and human capital matter, it is advances in technology that mostly account for economic growth.The other is that economists do not actually understand how technology generates growth, which is why there is such heated controversy about whether or not the internet and other aspects of information and communication technologies have boosted the trend rate of productivity growth in the US, and if so by how much.

The links between technical advance and increases in productivity are certainly long and variable. But are we unhealthily obsessed with the role of technology in production? Should we consider instead its role in consumption? If you put it like this, it is obvious that there has been no retreat in the New Economy. It might not be clear exactly which types of mobile phones or online music services are going to win in the various competitive races taking place, but there is no doubt that people have a still insatiable demand for mobile telephony, for the distribution of services ranging from e-mail and music all the way to pornography over the internet, for digital photography and film, for game handsets, for next-day delivery using modern logistical systems of items ordered online or by phone, or looking a bit into the future for genetic information. The list of new high technology products and services is long indeed and the demand for them is far from satiated.One economist who argues the demand side is more important than the supply side in the New Economy is Danny Quah, a professor at the London School of Economics.