Okay, here's what I think.
Nintendo should just expand and improve their output. Third parties don't "get" it, they cannot create nor sustain success for Nintendo consoles. It is because of their own games that Nintendo is where it's at now with the Wii and DS, and it will continue to be about their own games.
Their big mistake is the exact opposite of what people think is the problem. They are leaving too much room for third parties to thrive on their systems, they need to take hold of that and expand their output.
This focus on third parties in the industry is becoming completely irrational. Third parties have made their choice generally speaking, some of the top developer circles in Japan would like gaming to sink before supporting a Nintendo dominated future. This can be seen expressed literally. Nintendo needs to expand and make more software. They need to speed up their innovations and excite the market with new things more quickly.
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