(The intent of this thread is not to flamebait or troll so do not get mad but just think.)

http://seanmalstrom.wordpress.com/2013/10/12/email-the-format/

The more intesting part of this is:

"The idea is to make the business gavel speak in ways gamers and the game industry did not connect. For example, when Iwata says, “Nintendo cannot compete,” my business gavel said “Bullshit.” Why did it say that? If we look at the history of the generations and the business performances, we find Nintendo outperforming both Microsoft and Sony in the more important ways. For handheld consoles, Nintendo has been dominant there since the 1980s despite tons of competitors trying. As for home consoles, Sony doesn’t always win. Nintendo’s Wii did outsell the PlayStation 3. Microsoft’s Xbox franchise is far weaker than many people perceive. First Xbox sold as bad as the Gamecube (and the Gamecube was profitable, first Xbox lost billions). Xbox 360 ended up in third place and lost money. Xbox One will likely lose too. Microsoft refuses to put out a gaming handheld. If anyone cannot compete, it would be Microsoft. There is nothing to ‘discuss’ about any of what was just said. By saying Microsoft’s console hand is far weaker than it actually is contradicts what is normally heard in the Game Industry. This is where the controversy often comes from about the content of this site. However, the major investors have taken control of Microsoft, fired Ballmer, and may end the Xbox Franchise altogether. This is only a shock to people who don’t use a business gavel. Investors use business gavels all the time. While some might say Malstrom has prophetic abilities, the reality is that I’m only trying to look at things with the same context investors do. My flaw is that I am too generalized, however that comes from lack of precise information that investors and analysts receive."

Despite Iwata saying that nintendo can not compete the point sean is trying to demonstrate here is that it is microsoft who can not compete in this section.

Despite the fact that the xbox brand grew with the xbox 360 it ended up in third place thus leaving more to be desired from microsoft to become a market leader. Sean was right about the original xbox selling as bad as the gamecube and losing money while at it to boot and what's more is that the xbox brand has yet to make any profit so far in total. 

What do you guys think about his assessment ? (I agree with what he is saying.)

The xbox brand may not be as strong as what most of us thought. 

Malstrom? Ew.

What's the matter with him ? He's usually right. 

That is a far too generalized analysis. The problem with Microsoft isn't that it can't compete, it is that it can't compete globally. The 360 will be the market leader in the biggest market in the world, that is no small feat. It is also the most profitable market with the biggest software attachment. However, Microsoft struggles in a lot of Europe and is completely dead in Japan. That isn't necessarily bad for Microsoft. Their sales numbers for their hardware isn't something to dismiss. This generation was so even that saying coming in third place is somehow bad is just a pathetic argument.

I would also dispute the fact Microsoft lost money, I'm pretty sure it has been established that the 360 has made a profit, although not a large amount, especially in microsoft terms...

I wish I knew what's the matter with him, too. He should really get it looked into.

Why would you do that since investors are going crazy to eliminate the xbox division. The xbox 360 has made profit but it is meaningless since investors see the bottomline. 

Maybe from a hardware standpoint I agree as He said the original Xbox lost billions and the 360 was not the huge success Microsoft leads everyone to believe, But (and a very big but :P) Microsoft has done extremely well with software even with the original Halo on the Original Xbox it sold extremely well especially with the install base it had, and we all know that consoles at least in the beginning lose money and most of the profit made with console company's are Software and in that Regard Microsoft have done pretty darn good even in the last couple of years it managed to sell good amounts of software even though there hasn't been much out there recently. But one last thing is that Microsoft could definitely be out of the hardware game if they don't show much success in the next couple of years, they have not made as much money as they had hoped for with their last two consoles so I believe that XB One has to be a pretty big success (i'm talking like over a 100 million units kind of success) to be able to compete anymore with Sony and Nintendo in the hardware market as both of those companies have had that kind of success.

tl;dr I disagree :/

Quote taken entirely out of context. What Iwata meant by not competing is obviously not that Nintendo couldn't be successful, but that they weren't going to be successful attacking the same market as Microsoft and Sony.

Nintendo was attacking the gaming market so what is there to say ?