MDMAlliance said:
It still doesn't make any sense at all because Epic said that the 3DS "isn't powerful enough." They didn't say anything about programmable shaders or anything. Not only that, but I don't even know how that really does anything because the engines are made for the specific hardware in many cases, not the other way around.
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Here's the relevant quotation:
"There's only so much time in the day; our engine requires a certain level of hardware capabilities to make our pipeline, our tools work - and we work on the ones that do," vice president Mark Rein told Joystiq at the Game Developers Conference.
"The second Nintendo releases a piece of hardware that can run our engine well, we'll be on it like water on fish."
"There's nothing against Nintendo," Rein continued. "I hate that people somehow think that's the case.
"If we felt it could run [Unreal Engine] and deliver the kind of experience people license our technology to build, we'd be on [the 3DS]."
As you can see, he did not simply state "it's not powerful enough", which would be a rough judgment on the overall results you can get from the 3DS. He said that it lacks some capabilites that are vital to their tools set, meaning that it would require too much resources for them to adapt the engine.
Engines and toolsets are not rewritten from scratch for each platform: they are sets of many coupled, modular pieces of code. Your goal is to make it so you can port it to a platform by rewriting the minimum. If a missing hardware feature would require you to rewrite too much of that codebase, it becomes a bad business venture.
And yes, he does not name shaders, but that was the opinion of many commentators when comparing the 3DS with the (supported) iPhone 3gs: the most glaring difference was the iPhone sporting an OpenGL shaders API for its GPU.