Satoru Iwata says the firm will refuse to make increasingly powerful games in the race for the bigger market share. He said Nintendo must take a new and distinctive approach as an entertainment company, concentrating on creating better games.

He said: "We can't be optimistic about the game market. No matter what great product you come up with, people get bored. I feel like a chef cooking for a king who's full."

Although he did not give any details of what Nintendo has in the works, he gave one example of where his company hopes to differ: It won't pursue online games, judging them as still too limited in appeal.

"The element of surprise is critical. But delivering surprise is becoming extremely difficult," said Hiroshi Yamauchi, Mr Iwata's predecessor, "game developers are running out of ideas."

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