UPDATE:
It seems they might make phones their competitor after all...
by offering free talk!
PHONE CONFUSION AT NINTENDO
De-facto leader Miyamoto wants walk-about-town DSi, but Nintendo President Iwata says no monthly or costly bills. Skype says it's possible; this one's hard to call.
Nintendo has repeatedly denied and dissuaded the idea of edging in on the market of iPhone, iPod, cell phone, et al. But reliable chatter has led the videogame world to swirl with news of the DSi used as a mobile phone. The DSi media is not set up to directly compete with other markets, so far a download-and-go element prevails, an argument Nintendo has used to compel their competitors not to worry.
The talk of a DSi phone came as internet phone software Skype confirmed through TechRadar that their VoIP software could run on the DSi. The Skype Rep. said: "Whilst we can't comment on any future plans to bring Skype to Nintendo's DSi, it would technically be possible.
This follows Nintendo's Shigeru Miyamoto saying he was "interested in [a system with which] when you're walking in town with your DS, you can use various services." This opens the market to direct competition and might prove to skeptics that the DSi is ready to compete. Nintendo President Satoru Iwata said phone use by contract is not something he intends for the DSi.
It doesn't seem Skype is Nintendo's answer, but that Nintendo is formulating their own. If the two Nintendo giants join together, we might have free mobile phone communication on the DSi.
http://www.ds-x2.com/news/Phone%2Bconfusion%2Bat%2BNintendo,12672,12672