Developers/Nintendo already have to compete with freemium games. That war is on their doorstep whether they want it or not. There is no kid who doesn't know what Angry Birds or Clash of Clans are or hasn't played free mobile games.
Nintendo's bet with NX I think is they can't beat this, but they can profit from it themselves, and maybe at least have a voice in the sea change.
If kids start downloading "free" games on NX like crazy, Nintendo will take their 30% cut of all app revenue, which will likely be immense, probably more than the 3DS and Wii U make now off licensing fees even if NX is successful as nothing but a cheapo kids gaming tablet.
Then if Nintendo can get a few of those kids to buy "full price" games now and again, that's a win for them, better to have something than nothing.
They may also have to experiment with different pricing tiers. There should be $19.99 games. And $9.99 games. And $29.99 games, and not just used titles or games that are on sale.
Little Johnny consuming his Angry Birds and Minecraft and (yes) Pokemon Go on an NX is beneficial to Nintendo, and they can get him to buy even a full priced game like Mario Kart 10 even once a year .... that's better than the alternative for Nintendo (which is sit around and watch mobile erode their entire kids audience). Much better.
