It has nothing to do with third-party support. It has little to do with the DVD player.
It has everything to do with the "simplicity" approach Nintendo took.
Nobody wants a system that does NOTHING the competition doesn't already do. Everything the Gamecube did, either the PS2 or the Xbox already did. It had nothing unique to offer, except Nintendo first-party offerings.
The PS2, however, offered an earlier release date, a DVD player, and larger games, which, yes, resulted in a greater library in the end, and more third-party offerings. But it ultimately began with their earlier release date and the momentum created thus.
The Xbox offered DVD playback as well, greater power, the first heavy-duty online service, and a hard drive out-of-box.
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