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EDIT: Since no one seems to be reading the OP, I'll try to summarize some major points

 

1. The tablet is gone as Nintendo would have had no idea that it could take off, instead the Wiimote is the primary controller. That's $100 off the price right there, if not more.

2. The GPU obviously wouldn't be as great. It would be downgraded to match the PS3/360 in terms of pure graphical output.

3. The RAM would be cut in half, saving another $20-$30, and it would still be double what Sony and Microsoft offered.

4. A $50 loss is negligible in the video game business where most sales come from software, not hardware. Sony took a much bigger loss and still managed to succeed in the long run. 


So, a major problem that third party developers and consumers eventually had with the Wii and are currently having with the Wii U is their lack of power compared to the competition. This has me thinking, what if instead of releasing the Wii (which was a slightly upgraded Gamecube with motion controls), Nintendo released a traditional console about equivalent to the Wii U? Obviously they probably wouldn't have a gamepad controller, but using the wiimote as a primary controller would have still been innovative. 

The Wii U is based on PowerPC architecture, which would have fit perfectly alongside the Xbox 360, and the CPU is comparable in terms of power to the PS3 and 360. Now, the GPU and RAM that the Wii U has today would have been too costly, but 512mb-1gb of RAM wouldn't be impossible and a slightly downgraded GPU that could do DX11 would easily suffice.

All together, the hardware in 2006 would have probably be sellable at $400 if Nintendo was prepared to take a $50-100 loss for each system sold, which would still have undercut the PS3 and matched up with the Xbox 360. Nintendo wouldn't have pushed out nearly as many units, but it could have easily reached 60-70 million with third party support, and probably wouldn't be in the same position today, as the successor would probably be much more powerful (comparable to the PS4 and Xbox One) and would almost certainly have much better third party support.

Now, I'm not saying the Wii U isn't next-gen, it is and I love mine. It just feels like if they had released a slightly downgraded one in place of the Wii, Nintendo would be much better off in the long term, even if they lost those Wii sales.



                                                                                                               You're Gonna Carry That Weight.

Xbox One - PS4 - Wii U - PC