My personal feeling on this has been that this strategy could work for Nintendo IF:
The system is expandable somehow and can be upgradable cheaply in the future. In 2 years time, the 28nm manufacturing process will be matured, and the cost of things like GDDR5 RAM and a 2TFLOP GPU will be dirt cheap.
If the Wii U had a cheap connector like a Crossfire port on the bottom of the unit, it could be expanded around mid/late 2014 and probably be brought up to par directly with the PS4/720 for people who really need that for probably as low as $99.
I don't think that would be a bad play. Launch in 2012 with a cheap machine, start building that userbase, and then have the option of future proofing as well.
If there's no way to expand the system though, I think Nintendo could be in some trouble here if Sony/MS slap LCD screens onto their next-gen controllers too. Because then Nintendo is stuck the next 3-4 years with a system that doesn't have anything particularily unique about it and is a good deal behind on the horsepower angle too.







