I meant in the same timeframe since launch. I know you understood my point, but since you had no way to make a counter argument, you pretended I was wrong. Now your whole post is irrelevant and you ended up like a dishonest person.
Also, notice that Japan got Wii Fit in 2007, so the effect didn't last as long as in the West which got it in mid 2008. You have clearly no idea of release dates in Japan and therefore your argument about Wii losing steam magically in Japan compared to the West is completely wrong.
Then your reasons as for why home consoles are big in the USA and not in Japan are terrible. Japan always had the same amount of terrain available to build houses on, that didn't affect the previous 4 gens where there were also handhelds available and where home consoles sold impressive numbers. Japan has been the same country in terms of occupied space since 1980 and onwards, your reasons about them not having space arehorrendous honestly. The USA is buying the same amount as always, don't know where you get the idea otherwise.
Still going by your reasoning, Europe also hates consoles then I assume?
Lastly, saying third party games don't count is just... I have no words. You think PS1 and PS2 won all magically by themselves? The droves of games coming out for them were astounding, something never seen before in the previous gens. Without them Sony would have never been able to beat Nintendo, which actually didn't need 3rd party support in the SNES and NES eras as much as Sony did, because it was almost like a monopoly back then. Nintendo controlled third parties and their consoles were the ones selling, so 3rd parties had to accept the way Nintendo managed the whole VG market. Had Sony not received all that 3rd party support, then history would have repeated itself again with Nintendo on top.
Notice now Wii has gotten more third party support than the competition, albeit terrible support. Wii has been selling more than the competition because it's became a social phenomena, but slowly has been losing steam. The lack of interesting and innovative ideas from 3rd parties stopped the Wii from becoming the next PS2 and the fact that most of 3rd party games are now heading to the opposing consoles. Nintendo can't keep the Wii momentum as high as in 2007-early 2008, when they released about 20 1st party games or more World Wide. They haven't released even 12 new games since then until now. Their resources are limited and then the results become apparent. Momentum is lost. Yes, Nintendo could keep the Wii at astronomical heights by their own, but they can't do miracles, and if one of their games fails to do what was expected, we get the kind of market reaction we got in late 2008 until late 2009, Wii going down in spirals.
What you said was "Wii was outselling PS2 until 2009." Which means, well, that the Wii was outselling the PS2 until 2009. It's your fault for not being clear.
The problem is you analysis is very short sited. You never talk about customers and reading your post makes me think you thought the Game business started in 1994.
First off, Wii Fit released on December 1st in Japan, which means it only had 31 days to push hardware vs a whole nother year in 2008. So just because it was released in 2007, doesn't mean it's effect was taking place in 2007. Mario Kart and Smash Brothers were released in 2008, so hardware should have still been up in 2008 seeing as Wii Fit would carry hardware farther in 2008 and probably for a few months (which all those titles did on a worldwide scale).
Now why did handhelds jump in Japan where they didn't before. Take a look at yearly data, and you'll see the GBA was always strong in Japan relativaly. The GBA beat out the PS2 two years and they were usually close (no more then 1 million off). So the Japanese were still buying handhelds along side consoles, sometimes even more so. But why the big leap? Simple: The DS became good enough. Up until that point, the strongest handhelds was equivilant of a hardware from almost 10 years ago. But, the DS was not as strong (or stronger) then an N64. "But the N64 was pretty old then too?" Oh, but you forget, we are reaching "good enough." In all markets, but esspecially technology, the product becomes "good enough." This means that the current offering is just right for consumers. Go past this, and you'll do what is called "overshooting" where the products becomes more then what people can handel or notice. But now handhelds are getting "good enough." The 3DS will be "good enough." This power also opened the door for RPGs. RPGs could not compete with those on the consoles, but now, with stronger hardware, they are doable. Final Fantasy 3 also opened the door for this, which also goes to show how much one game matters. Now, the DS is the RPG system. (NOTE:This is all from disruption liturature)
Remember my friend, that demand may exist but may never be realized. This is why Blue Ocean Strategy exist. There are lots of markets that do not exist yet, which means there is demand for goods and services that do not exist yet. Japan may have always wanted to buy more handhelds, but couldn't yet because they didn't mean their wants.
But what about Europe. First, Europe in 2009 bought fewer Wiis, but not by much. Less then a million difference. We'll see how 2010 goes. Remember though, that Europe is mix between Japan and US. Like Japan, they are a smaller country, so they move around a lot. Thus, there is a reason to have a handheld (in the US, handhelds are very much a kid's system, although that is somewhat changing with the DS). Of course, a lot more of their land is usable, and their apartments are no where near as small as Japanese ones, so there is still a market for consoles.
And boy, you don't know your history. First, third parties always wanted to jump ship because Nintendo was very strict and wanted to take them for all they were worth. They tried going to Sega, but they didn't see the same results and were stuck with Nintendo. They always wanted out. Of couse, you miss why Sony was successful. Third parties played a major role and was a strong strategy, but a lot of it had to do with Sony themselves. Sony grew alot due to globilization and economies of scale. The PS1 was the first system to be successful in all regions. The NES was never strong in Europe due to lawsuit in the US and the SNES fought with the Genesis. Sony grew thanks to globilization. Population growths in all regions also helped. Sony also has Economies of Scale, and they can leverage factories and other media for their console. They basically could do things Nintendo could never do. Let's also not forget that Nintendo did not release a 2D Mario for the N64 or GC. Had they, the history of videogames would be a lot different (look at what NSMB did for the DS and the Wii).
Third party support on the Wii was never an issue. Nintendo has done well with crappy support and I don't think it matters if they have none. Consumers buy hardware to play software. We can all agree to that. So, why would they buy a Wii for a bad third party game. They would not. So, then why does it matter if there is bad third party support vs no third party support. The alternative is the same: they just don't buy a Wii. The Wii's situation is due to a lack of software on Nintendo's part that pushes hardware. Nintendo has only releases NSMBWii since the start of 09. All the other games were sequals or wont move systems. This may be in part to Nintendo chasing UGC and having to shuffel around software (and this may have made people more hostile to the Wii). Nintendo needs to release software, and I think Wii Relax and Zelda will do the trick.
One thing you do wrong is you never look at what consumers do. You ignore them entirely. Your analysis will never been good until you take them into account. As they are now, they are very much fish bowl views. You look only at the data and make inferences about that and don't focus on buying patterns.