EEDAR analyst Jesse Divnich has predicted that Nintendo will announce a true successor to the DS later this year ahead of a 2011 launch.

“We believe that due to the aging technology, the possibility of new competitors in 2011, a decline in publisher support and piracy, Nintendo will launch a successor to the DS within the next 15 months, and likely announce such in the next eight months,” he said in a research note.

“Nintendo has always had a controlling stake in the handheld market, despite facing numerous competitors, and EEDAR believes one of the biggest reasons for Nintendo’s success in the handheld market is their ability to remove opportunity gaps for competitors to enter. Nintendo’s transition from the GBA to the DS, a year earlier than anticipated, was a brilliant strategy to remove any upper hand the Sony PSP could have by being first to market.

“Piracy continues to be an issue, not just for Nintendo, but for its third-party publishers as well. Whilst the release of the DSi has slowed down piracy, that slow down will only be temporary as hackers have already managed to bypass the new security systems built into the hardware.

“Additionally, many publishers including Sega, Capcom, and now UbiSoft have all expressed that they may be reducing their exposure to Nintendo’s consoles, which will likely lead to heavy declines in both hardware and software sales for the Nintendo DS.”

Divnich also suggested that “any DS successor will most likely be backwards compatible”.

The analyst’s comments come shortly after Nintendo president Satoru Iwata was reported to have spoken openly for the first time about the features that the DS successor will offer.

"[It will have] highly detailed graphics, and it will be necessary to have a sensor with the ability to read the movements of people playing," the executive told Japanese newspaper Asahi.

Nintendo’s US division later claimed that Iwata “did not make any comments regarding the functions of Nintendo's future hardware systems”, suggesting the executive was “misinterpreted", although the paper has since told Kotaku that "the article quoted Nintendo president Satoru Iwata's comment accurately."

In October last year it was rumoured that Nvidia had been lined up to supply a “Tegra system-on-chip processor” for the successor to the DS. It was also speculated that the new handheld would launch in late 2010, featuring “smarter” graphics and DS backwards compatibility.