I think the bottom line is this:
Nintendo wasn't able to stop people from ditching dedicated handhelds to go play on smart devices by ignoring smartphones. They threw damn well every one of their big IP at the 3DS and still nada ... they collapsed half from the DS and 3DS shipments were declining yearly at a disappointing rate on top of that. It's quite possible the next handheld would see further erosion and with their console line doing terrible, well you can guess where this is going ...
Weighing the risk/reward I think they finally felt the rewards of making iOS/Android software outweighed the risks given the way the sea tide was going against them.
Having a generation of kids grow up with no access to Mario/Zelda/Pikachu/Kirby/etc. I think was just too grim of a scenario for Nintendo to accept, so they caved and agreed to smartphone games.
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