Great article. One can quibble about the groups - I think group 2 (Traditional Casual Gamers) probably has a few subgroups in it- but the anlysis is essentially correct.
Remember people criticized the GCN for lack of online support. By the "end" of the last gen, the majority of gamers were still not gaming online (about 25% of XBox users, the console most dedicated to the idea). I don't know anyone who really credits the GCN's lack of online support as a reason for it doing so poorly.
The same thing seems to be happening with HD-TV/DVD. People are reluctant to get it, and confused by the formats. Many just want the big, flat screen, and can't tell the difference in the picture. I expect that to change over time, but I don't see it as a huge factor in the Wii's lifetime (which, if it keeps to form, will be about 3 more years, then one last "life support" year leading up the Wii2 launch).
And really, other than making games prettier or putting more enemies on the screen, the vast majority of games will not have their gameplay substantially altered by graphical horsepower.
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