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Soundwave said:

Well in a way, with the Fusion concept, third parties can go screw themselves really, Nintendo will be able to supply the system with a steadier stream of software when their dev resources aren't split between two seperate platforms. 

Though ironically I think third parties will be more apt to jump in too, because for one having just "one ecosystem" lets them check off their Nintendo to-do list easier ... now they can make one version of a game and it covers both the Nintendo console and handheld and has access to the wider Nintendo audience.

So while Ubi Soft for example may not give a poop about giving the Wii U the new Assassin's Creed for example, they may be more likely to give it to Fusion though, because effectively they're getting both a handheld and console version of their game in one shot under this model, which is less risky (at least in publisher logic). 

Japanese 3rd parties will likely line up to support this type of platform too. 

@bolded:  You just made a very compelling case as to why Nintendo would choose this route.  

Seriously though, if 3rd parties are inclined to give it a go based on the "wider audience/less risk" philosophy and the price is right, then I could see that kind of thing being a major player with the right marketing, launch games, etc.  

And yes, I have little doubt that it would be a resounding success in Japan.