Let me explain to everybody why there can be too much of a good thing. The last several generations in both consoles and handhelds have all been won by the middle or low power system. The following all show the consoles of the most recent generations in order of increasing power. The one which sold the most ("the victor") is in bold.

Gen 5: 3DO, Atari Jaguar, Sega Saturn, Playstation, Nintendo 64

Gen 6: Dreamcast, PS2, Gamecube.

Gen 7: Wii. 360, PS3.

--HH: DS. PSP.

Gen 8. Wii U, PS4?, XBox One?.

--HH: 3DS. Vita.

There are two clear trends. First, in the absence of other variables, the market favors the middle console. Second, as time goes on the market becomes more willing to pick the low power console, not the high power monstrosity.

Of course, this is because there's no such thing as a free lunch. You buy a high power console and the manufacturer will pass the expense on to developers via license fees and dev kits. Developers will pass the fee to you, the end consumer via lowered production values, DLCs, or stuff like that. You always pay for what you get. Eventually.

1. They need more 1st and 2nd party devs, even if it alienates 3rd parties. Nintendo has a multitude of franchises that haven't been used in years. Fill in gaps in their own 1st party schedule.

2. Focus on gameplay innovation through software and not hardware. No matter how much we want Nintendo to be innovative, 3rd parties like development smooth, they don't want to make stuff for unique hardware, they want to have easy to develop ones. You can't totally forgo 3rd parties, so stop trying to reinvent the hardware wheel and focus more on software innovations.

3. Keep Miyamoto out of business decisions. Love the man, love what he does, but dude's got the mind of an artist. He's impulsive and stubborn. Legendary game maker? Yes. Good businessman? Not really.

4.Don't fire Iwata. There are many people out there that hate Iwata and blame the companies faults solely on him. But he ain't running the show unlike other people believe. Yamauchi and the board of Ds still holds awesome power. Think about it, who would replace him? Some Western CEO that doesn't have a clue about gaming? Iwata being a game developer himself is the reason why we're not seeing yearly Animal Crossing expansions and Zelda/Pokemon paid DLC. Despite this dude's shortcomings, he's actually got a good idea of where gaming shouldn't go even if he's not sure where it should.

5. Be more inventive with your current franchises rather than trying to make new triple A titles. Let's see more SM64 and OoT style re-imaginings rather than a new military shooter. I've heard a lot of arguments that Nintendo should make an awesome triple A title and then market the hell out of it. That isn't how Nintendo works. They find a gameplay aspect or idea that they like, and then design a game out of that gameplay aspect. I'm talking about more experimental games like Xenoblade (It was an experiment) or Crashmo, Dillon. Use small games like these to found out what exactly clicks. Then use it in other franchises. More than new faces, we want to see new ideas, new ways to play. We don't need another 2D platformer with a different character or another Metroidvania starring someone that isn't Samus. We want to be able to do thing with the characters of the past that we haven't been able to do before.

Don Mattrick

If only they could pay people for coming up with million-dollar ideas...