The reason past companies failed at creating handhelds (Sega, Atari, Tiger Electronics, etc.) is that they tried to make improvements that the original Game Boy lacked (color, backlit screen, etc.) The only problem with this is that they did not PLAN at first.
The GameGear improved on the Game Boy's tiny gray screen by adding a backlit color screen and enhanced power. It used 6 AA batteries, which obviously were needed to provide extra power for the lighted color screen. But since there were no good rechargeable batteries back then, the GameGear wasted batteries very quickly.
As for the Atari handheld, I have no idea.
The Game.com (I think that's what it was called) was a good idea, but Tiger Electronics made it too much like a computer. They crammed all this extra stuff in it that was utterly useless. The Game.com also used batteries very quickly. Plus, the public wasn't interested in buying a bland gray-tinted handheld when the Game Boy Color was already released.
Now that the GBA-SP is here, Nintendo is once again king of the handheld market. They finally made a Game Boy with a rechargeable battery AND a lighted screen, which was what we fans have been begging for all these years...aside from a color screen.
Sony's PSP is a great idea. Nintendo has dominated the handheld market for over 10 years, and it's about time some new company tried to challenge them. The PSP has all of the features that the GBA SP has (rechargeable battery, backlit color screen, etc.) and improves apon them as well. The only problem with the PSP is the disk drive. The UMD mini-disk is a great improvement over cartridges, but I can't see how Sony will be able to put a tiny disk drive in a handheld system.
The Nokia N-Gage is crap. Crap, and piles of more crap seeping through the hard crusty remains of older crap. It is the stupidest idea ever. A cell-phone that turns into a gaming system... That is rediculous! Have you seen how many buttons that thing has? At least 20, including the number and menu buttons!
People who like video games should also like Nintendo. People who don''t like Nintendo obviously don''t like video games.