Because you imply that that is wrong when it actually is how things work.

Think about it: How can Nintendo hardware continue to exist when third party support is so lackluster and has been for two decades now? The only explanation is that Nintendo content drives the hardware sales, because ultimately dedicated gaming machines are bought to play video games. Hardware doesn't sell itself.

Your last sentence in the preceding post makes the mistake of drawing a conclusion based on current market conditions and accepting them as definitive. Let's go back ten years: It's 2004, the GameCube struggles mightily, third parties are abandoning ship. Now the question is posed if Nintendo will ever be able to reach the NES height again. Your answer would be: "No, because the NES didn't have the fierce competition of Sony and Microsoft that Nintendo has now." - But if we go back to the present, to the year 2014, we have the benefit of hindsight. Now we know that Nintendo not only reached the NES height, but eclipsed it. We know that looking at market conditions of a given time and thinking of them as unchangeable can make us horribly wrong, especially in a business that resets to 0 each generation.

And this leads back to it being in Nintendo's hands to create software that pushes their hardware to such heights. Nintendogs and Brain Training have fizzled out in the 3DS era, but what's there that prevents Nintendo from making new IPs? Only their own decision-making processes. Nintendogs and Brain Training were new IPs in the DS era and largely responsible for the sales uptick in hardware. Before their releases, the DS lagged behind the GBA. Afterwards the DS accelerated and never looked back.

Because you imply that that is wrong when it actually is how things work.

Think about it: How can Nintendo hardware continue to exist when third party support is so lackluster and has been for two decades now? The only explanation is that Nintendo content drives the hardware sales, because ultimately dedicated gaming machines are bought to play video games. Hardware doesn't sell itself.

Your last sentence in the preceding post makes the mistake of drawing a conclusion based on current market conditions and accepting them as definitive. Let's go back ten years: It's 2004, the GameCube struggles mightily, third parties are abandoning ship. Now the question is posed if Nintendo will ever be able to reach the NES height again. Your answer would be: "No, because the NES didn't have the fierce competition of Sony and Microsoft that Nintendo has now." - But if we go back to the present, to the year 2014, we have the benefit of hindsight. Now we know that Nintendo not only reached the NES height, but eclipsed it. We know that looking at market conditions of a given time and thinking of them as unchangeable can make us horribly wrong, especially in a business that resets to 0 each generation.

And this leads back to it being in Nintendo's hands to create software that pushes their hardware to such heights. Nintendogs and Brain Training have fizzled out in the 3DS era, but what's there that prevents Nintendo from making new IPs? Only their own decision-making processes. Nintendogs and Brain Training were new IPs in the DS era and largely responsible for the sales uptick in hardware. Before their releases, the DS lagged behind the GBA. Afterwards the DS accelerated and never looked back.

It doesn't matter whether the question is NES or PS2. Additionally, the NES actually sets a lower bar for Nintendo success, but even that would have been answered with a resounding "no". That's the whole point: Current market conditions should not be taken for granted and seen as final in an entertainment industry.

The current forecast is that the handheld market will continually shrink and ultimately has no future. People look at the 3DS and PSV, and predict that it's going to get worse for their successors (if they will be made at all) because all current sales data points to that. My point is that such a trajectory is not set in stone in a business that works with resets of installed bases. Everytime a company launches a next generation system, they start at 0 all over again. Therefore the perception that current handheld systems have (devices that are on their way out because they will be replaced by smartphones) may or may not be the same in the future.

Another example: The Xbox 360 did beat the PS3 in the USA by a significant margin, so many people expected that the Xbox One would beat the PS4. Their reasoning didn't go beyond "Xbox rules now, it's going to stay like that.", but the launch of these eighth generation systems was a reset, so the previous market conditions were rendered null and void. Not even a year has passed since the launch of these systems, but the way the market is viewed has changed dramatically already.

The handheld market is shrinking this generation, there is no doubt about it. But that can be reversed in the next generation.

This question basically comes down to.......

1. Can Nintendo make one or two 20M+ sellers a year for 5-10 years?

and

2. Is it possible to sell 20M on a dedicated handheld in the era of smartphones and tablets?

Many people might answer no to the second question. To those people I would ask...

3. Can Minecraft sell 20M on home consoles when everyone has a smartphone/tablet/PC/netbook/laptop that can easily play Minecraft?

If the answer to question 3 is yes, then the answer to q2 is yes. That leaves q1.

Can Nintendo get Nintendo-lucky again?

It's been pointed out many times that Nintendo wasn't lucky. Many choose to ignore the reasons even though Nintendo spent years screaming from the rooftops and explaining in detail how they planned to successfully disrupt the gaming industry. They even invited others to join them, and Ubisoft managed to successfully disrupt Activision in the music genre while Nintendo smashed EA's sports crown, without even trying.

So it all this boils down to not can but will.

Will Nintendo ever read the 'Innovators Dilemna' again? Will Iwata 2017 listen to Iwata 2007? Will Reggie '17 listen to Reggie '07 or is Candy Crush and Flappy Bird the best that normal people can ever expect to play on a £500 non-dedicated device?