Phones are the latest tread right now. They out perform consoles and have a vast library of games. That won't always be the case. The era that smartphones do the most damage handheld consoles is right now, not the future. Yet the 3ds still clings onto a good market because enough people see the advantages so a handheld console. The comfort of the controls and the library of games.
Mobile cpu power is going to hit a wall soon and then handheld devices, both phone and console, will be almost on a par, cpu tech wise. Console will probably be underclocked for battery life because they're designed for playing games long periods of time. But the graphics will probably look close in many cases.
I can see handhelds making a comeback. Though there might be a market for a good Android powered handheld console in the future.
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