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Look at the PS2.

Look at how many niche games went on to be complete flops, whereas crap like Spongebob and Finding Nemo and The Incredibles sold millions.

The Wii isn't anywhere near as bad as the PS2, at least so far. And developers won't be tempted away from development for hardcore games. It just means that there will be less shovelware for the HD consoles (which is both good and bad). Either way, you won't be seeing something like Conflict: Denied Ops two years from now.