I think the big problem is that, from the bdginning, Nintendo always makes their consoles for the games they want to make--third parties be damned. Sometimes they acknowledge third party needs (ie: Pro Controller) but it always seems like an afterthought. Not sure if it's possible to thrive without 3rd party support these days.
Yeah, some of Nintendo's ideas may actually be good. I appreciate the low energy consumption, small foot print, lower dev costs, etc and their money making model seems pretty sound. It's just harder to compete when you have companies like M$ and Sony willing to throw everything including the kitchen sink and are willing to risk money to do it (but recoup the money in other ways) AND have the power that 3rd parties crave.
