Being as objective as possible, I don't think Nintendo can be so naive as to expect that western developers are going to support them if they don't offer competitive hardware, or a business model that makes more sense considering current market trends (in case of portable software). Do they really expect western developers to start creating "new types of game experiences" using the game pad? Can they keep selling software at $40 for the 3DS when one can get games for free on smartphones and tablets?
In fact, the problem with Iwata's Nintendo is that they force us to choose between some sort of innovation versus state of art 3rd party support/cheaper software. If you ask me, this is all a matter of what they think is going to make them more money, the rest is just PR bulls***t. This generation will prove if Iwata is right or not, but to be honest I am not that optimistic.
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