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HappySqurriel said

I'm not saying that Nintendo is ensured success, but it is a very bad business strategy to cross your fingers and hope that your competition screws up ...

I don't think Microsoft has to count on Nintendo screwing up in order to prosper.  Microsoft's focus should be on not screwing up themselves.

The market is big enough to support two players that can both do really well.  I don't think we're going to see NES or PS2 domination from any company.  And again, despite going for the broader market with Kinect, Microsoft's bigger competiton is Sony, not Nintendo, as their gameplan/fanbase is very similar.

 

I have no idea what Nintendo has in store, but if I was Microsoft or Sony I would be worried that they were going to release the next "Brain Training", "Wii Fit", "New Super Mario Bros", or "Wii Sports" (basically, exciting/new 20+ Million selling game) before I even released my system

If Nintendo is destined to take the world by storm with innovation based on their new controller, it makes little difference if Xbox 1080 launches at the same time.  In fact, it could bode well for them to wait until they can come in with a tablet controller of their own, better hardware and a cheaper price than what they could achieve in 2012, all while a super cheap Xbox 360 and Halo 4 sustains them in the meantime.