Panasonic is developing a handheld game player in a bid to return to the video game market after more than a decade.

The new device will aim to challenge traditional console makers Nintendo and Sony and a growing set of smartphones and tablet computers that play games, Dow Jones Newswires reported.

It quoted a Panasonic spokesman as saying the company is developing a product called the "Jungle", with other sources saying that the device was a game machine.

A website, welcometo.thejungle.com, shows a handheld flip screen device briefly in a promotional video.

Panasonic's new handleld game system consists of a clamshell-style portable console with a display on one side and a keyboard and touch pad on the other, the TechCrunch reported earlier this week.

Panasonic has set up a new subsidiary, Panasonic Cloud Entertainment, to handle the game project, which will also involve video content creation.