It's been a formative 12 months for Nintendo and the 3DS.

When its glasses-free 3D handheld launched in Europe one year ago, few could have predicted how turbulent the future would be for the Japanese gaming giant.

Pricing the stereoscopic gadget at the unreasonably high tag of $249 and with a shortage of killer apps, cracks in its 3DS strategy quickly surfaced.

We were stunned when Nintendo announced it would be releasing a hefty chunk of plastic - a peripheral called the Circle Pad - to accommodate the needs of third party publishers.

The announcement of 40 percent price cut six months after launch had some people predicted an early failure; something not helped by the company's financial losses. 

Fast-forward to today and the 3DS is back on its feet celebrating its first birthday with some milestones under its belt.

But is it out of the woods yet?

As Sony's powerhouse portable the PS Vita jostles to finds an audience alongside with Apple's new iPad, plus the massive momentum of the mobile gaming industry, the competition is only increasing.

Disconnected

There's certainly plenty of work to be done to improve Nintendo's chances of staying relevant in the handheld market.

Embracing one of the company's biggest weakness - online distribution - should be a top priority.

Since the days of the GameCube, online has been an oversight for Nintendo. Instead it's settled for half-baked alternatives.

Even something as simple as arranging an online game remains a laboured.

There's hope in the form of the Nintendo Network, which is set to support both the 3DS and the upcoming home console the Wii U. But you need only look at what the PS Vita is doing -messaging on the fly without quitting out of games, accounts shared with the PlayStation 3 – to see how should be done.

Window shopping

Then there's also the eShop, Nintendo's digital shelf space that launched months after the console's release.

It's a clumsily arranged marketplace in dire need of becoming something more accessible and re-designed so that everything button press doesn't trigger a loading screen.

That said, the digital offerings have been much stronger with demos, gimmicky apps, and original content like Intelligent System's Platinum Award-winning PushBlox seeing the big N embrace the notion of unleashing pet projects upon the masses.

We're still short of some of the auxiliary services such as TV/film streaming (Netflix is currently unavailable in Europe) but if Nintendo moves some of its store shelves around and keeps the premium content rolling, it shouldn't suffer the fate of previous efforts at digital retail.

It's a-me!

So Nintendo’s technology is lagging behind, but it's the games that keep people coming back to its hardware.

That's what's kept the 3DS afloat with Christmas favourites Super Mario 3D Land and Mario Kart 7 selling around 5 million a piece globally. 

Sustaining this will be a key tactic in keeping an edge over the PS Vita as Sony continues to highlight its mammoth launch line-up.

New instalments of Animal Crossing, Luigi's Mansion 2, Professor Layton, the highly popular Dr. Kawashima's Brain Training - and no doubt something with Mario's face - will undoubtedly tide the system over but keeping the faith of third parties is equally important.

Big franchises like Resident Evil, Metal Gear Solid and Kingdom Hearts will have taken the chance to enjoy the 3D spot light but convincing them to do it again will take more than the system's most talked about feature.

Which takes me onto my final point.

Nip tuck

Nothing quite says take my money all over again like a handheld redesign.

Nintendo's DS went under the designer's knife three times with Lite, DSi, and XL (LL in Japan) versions going on to keep consumers upgrading. Industry rumblings have been buzzing since last summer's price cut, and a redesign is most certainly on the card.

It's something potential customers could very well be holding out for.

In addition to a longer lasting battery life, it's expected a redesigned model will incorporate the second Circle Pad that Nintendo embarrassingly slapped onto the existing model and that some of us would rather not fork out the extra cash for.

Nintendo is notoriously stuck in its ways but the last year has forced the Japanese giant it's time to make some changes stay current in a market it used to dominate.

With a handheld to support and a new console with a tablet controls joining its ranks, the next 12 months will be even more telling of Nintendo's longterm success.