People have been inducted to believe that they need a smartphone, that they are a necessity. Consoles aren't. To think that you can successfully apply the same business model of smartphones to consoles is wishful thinking. Plus, consoles are designed to last for years, until the next gen comes out, while smartphones can last three or four years, and that's if the battery doesn't die before than that.
If the PS4 Pro and XboxOneX have taught us something, is that console revisions increase sales, but don't move as many units as completely new machines, and the reason is simple, most people don't buy a new machine to play the same games that they do on their actual machines. Sooner or later, you need to break the cycle and launch a new machine with games that can't be played on the older model(s).
Lastly, if you're afraid of what could happen to Nintendo when launching a new machine, they can simply do what most third parties have done this gen: launch cross-gen games. With a strong line up of exclusive games like a new Zelda or proper Mario, paired with smaller titles for both machines, Nintendo can minimize that danger and keep the income high until the install base is high enough to sustain the business by itself.
You're wrong from the premise, and we have multiple cases.
GBA > GBA SP
DS > DS Lite
Both showed cases of people upgrading and also a market expansion.
I think you're underestimating the market of people who will pay money to upgrade their hardware and those more likely to pay money to buy it in the first place if it reaches levels of satisfaction. It is all about making the successor compelling, and a simple "half gen upgrade for 4K TVs" isn't as compelling a sell as a Switch gen 2, Switch gen 3, etc... Especially when Switch 2 and 3 are serving an obvious demand with more power, longer battery life, and/or different sized screen; meanwhile there wasn't much interest for the "more power for 4K TV Xbone or PS" product. Additionally, a hard reset on the product means those "half gen" consoles are halfway through the lifespan. Meanwhile, for the iOS model that platform has no end date, just upgrades to the hardware and software versions. A Switch iterative generation means you're buying the first or second most up to date hardware for a platform that isn't going to die in a few years.
I'm sorry but your post seems to contradict itself a bit. First you tell me I'm wrong in my assumption by citing the GBA and DS revisions, but then you go on saying that: "a simple "half gen upgrade for 4K TVs" isn't as compelling a sell as a Switch gen 2, Switch gen 3, etc... Especially when Switch 2 and 3 are serving an obvious demand with more power, longer battery life, and/or different sized screen", which is the same as saying that a Switch Pro won't be enough for consumers that will, instead, hope for a new console.
About the examples provided that did work, I won't comment on the GBA => GBA SP because I didn't follow the market as much then, but the DS to DS Lite is, sorry to say, bullsh!t. First of all, the original (and ugly) DS console was in the market for only a year and 4 months before being replaced by the same spec'ed DS Lite, the DS launched in November 2004 and the DS Lite came out in March 2006, and endeing production in 2007. It was the DS Lite model the one that was available through most of the life of the DS family, obviously being able to sell more units. And on top of that, the DS Lite was cheaper from the start, $150 vs $130, and took advantage of the launch of Pokemon Diamond and Pearl as well as the explosion of casual games like Brain Training and such.
There were a lot of other factors in place to make the DS Lite sell better than just being a new model, and the launch of he DSi Lite proved that.
Please excuse my bad English.
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