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Barkley said:

Well it'd hurt for Nintendo, because of course they wouldn't get any cut from steam games, whereas native third-party games they'd get a cut.

But I don't think it's something that would take off much.

Nintendo make most of their money on their own software and tbh most of the games people would play through the app are likely titles that won't be on the Switch to begin with as Switch third party is more like their portables pretty unique to the platform. For example Nier: Automata runs quite nicely this is a game that won't be on NS while the SE games on NS consist of the likes of DQXI, Octopath etc...