Yes, I think he's atleast partially right when it comes to competing with the past, and many gamers compare new games with older games they've played in the past. I know I do, and that's why I've been quite disappointed in the RPG offerings of this and the last gen. I compare newer RPG's to the ones I played on Snes and PS1.
I don't know if the solution is even close to being as simple as what Malstrom describes. How about games becoming less user friendly and the pick up and play of older games disappearing. The transition between 2D and 3D may have been to much for some gamers; gameplay changed, you often had to control the camera and many 3D games were really ugly.
I think there are many reasons why the Snes sold less than Nes. Some of the new gamers that the Nes attracted may have quit gaming, Snes actually had to compete with Nes in the beginning and Mega Drive was an important competitor as well. Nintendo probably had a problem with picking up new gamers, and that situation wouldn't change until the Wii.
With the N64, Nintendo were the last one to release their console, and it didn't had CD's like the others. Sony's Playstation succeded in attracting the mainstream market, and because of the not very developer friendly N64, Nintendo lost much of their third party support.
Gamecube failed to win back the third party support and they also lost the powerhouse that were Rare. Most gamers that bought a Gamecube probably did so because of Nintendo's own games. Most third-party games were multi-plat and PS2 had a much bigger market share and Xbox offered more power.
Today I would say that Nintendo are kinda in the same position as they were with Nes. They have a huge success named Wii, but they have to figure out how to stay at the top and not let the competition take over once again.
