Never was a threat and probably never will be.

I can agree with that. Mobile gaming's biggest problem is that the controls absolutely suck.

It never was a threat. It was a false threat and the video game industry seems to fall for false threats all the time. It's like when Square-Enix thought traditional JRPS's were no longer relevant because Call of Duty was selling in the 20 million range. No one seems to have learned that better sales do not mean there's a threat. What happens is that publishers feel like something like mobile is a threat even though their own sales do not suffer and as a result, they change their business tactics and try to reinvent older franchises in order to appeal to the bigger crowd. This ends up backfiring when a known franchise fails to catch the attention of the bigger crowd and alienates the dedicated fan base.

This is what happened with Resident Evil 6. Capcom felt that instead of trying to innovate like with Resident Evil 4, they instead needed to copy everything that has been popular in the Western market over the previous 5 years because some marketing executive decided that survival horror games became irrelevant during that time. A lot of the younger shooter fans and Gears of War fans ignored Resident Evil 6 since they recognize Resident Evil as a survival horror series while Resident Evil fans quickly sold their copy of the game when realizing that it's less of a Resident Evil game and more of a ripoff of everything else.

I don't feel like people like this concept you don't own your games anymore just the permission to play it

I don't think you can say this definitively. 

The console has been impact by smart devices, but just in a different way for Sony/MS. What the home console has become now is basically the home for high-budget, big screen experiences almost entirely. 

Games that are kind of "middle budget" or don't subscribe to the theory of being a violent/action/movie-style blockbuster tend to struggle. Even Sony and MS are showing signs of this, as LittleBigPlanet 3, Sunset Overdrive, Tearaway, Puppeteer, etc. basically flopped. 

There is less room on the console side for simpler/middle-tier games because people still like home console, but the home console is now becoming more and more strictly for the "big game" experience, whereas smart devices are filling "sweet tooth" for people who want simpler or medium tier experiences. 

I don't really sense movement from the casual side to consoles either, the lady playing Candy Crush on her iPhone to me is unlikely to buy a PS4 for Destiny. More likely the Destiny player is likely to download Candy Crush on their phone to play while they're out of the house. 

Us old farts don't like it. Our kids will probably laugh at us though when we tell them we used to have to drive to the store to buy each individual game and played it on a giant shiny disc. To them it will probably seem as antiquated as when our parents told us stories about buying music albums on an 8-track. 

Kids today don't have any qualms with the iTunes model or Netflix, they won't know any different soon enough. I do think there will be a physical Playstation 5 side by side with a streaming service, but there won't be a physical PS6, it will all be cloud based by then. 

The greatest threat from mobile gaming will come another generation or 2 down the mobile GPU heirachy when there is enough grunt for multiplat home console releases to be ported. However it also depends on the shift from $60 AAA to also continue as there is no market for that on mobile platforms ATM.

I don't feel like it ever really was, just a lot of smoke and mirrors from "analysts" and "journalists" who needed click able topics or who didn't understand the demographics to begin with.

a lot of hate for mobile games i see. apparently you're supposed to play them while you take a dump. not so... and i'm not sure taking a dump prevents anyone (what with wireless controllers, gamepads and cross-play) from playing "hardcore" games if they really, really want to. (perhaps the hardcore games are a kind of digital stool softener...)

anyway, there are many great mobile games. they do their thing and they do it very well. i think frequently they're more innovative than console games, and have to be because they have such limited control options. it forces developers to think of ways of doing a lot with very limited input options. it used to be that instead of eating the same open-world comfort food, people wanted their games to do something to surprise them.

Nintendo was hoping the mobile market would carry the Wii U and look what happened