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OP: Nintendo chose a poor strategy with their hardware, opting for obsolete custom die and parts that make their hardware cost deflation really slow compared to Sony and MS' setup's.
Basically; Nintendo have had little leverage with pricing since they've run the risk of losing money since launch if they slice the price by any significant amount.
What they got for their money will, in hindsight, be considered ridiculous, all things considered.

I said it from the beginning and I still hold to it to this day; the Gamepad was a huge mistake and by far the Wii U's main problem, both in cost, appeal and utilization.