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Seems like a money saving effort for the most part. Probably a good idea in that sense. Attempting to merge markets into one console; not so smart at this point. Look to the Vita to see the result...
Casuals now game on tablets and phones and the core will want the same as before, home consoles with home console fare and multimedia capability and good 'ole PC's with hardware oomph.

The massive irony of this whole mess is that Nintendo helped create and expand a market segment they will no longer be able to properly compete in. At least with core fans, they have very long and very strong pedigree.