Sony in 1998:
Let's release a "handheld" powered by a watch battery with a 32x32 monochrome screen smaller than a postage stamp that is barely above Tiger LCD games in terms of quality and well behind the already decade old Gameboy that also acts as a memory card... despite the games taking up most to all of the memorycard space. I am sure we will eventually release it in the US too so I don't see an issue with letting games add support for it outside of Japan.
Nintendo in 2001:
Here is a handheld that is practically on par with a 2D-only PS1, full color 240 × 160 screen, can link with a GameCube or other GBAs to temporarily download games or clients that can make full use of the hardware, and uses standard AA batteries. It's releasing in pretty much every region within 3-4 months of each other. Oh, and it does all this using the SAME processor as the PocketStation.
SEGA in 2001:
No, we're done with hardware. We already gave you a portable Master System and then a portable Genesis, we are NOT making a portable Saturn.