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Soundwave said:

If maintaining user confidence is based upon your late gen software support though it does not match up with the reality of the sales trends we see. 

We clearly see the GBA, GCN, XBox (original), Wii U not get 5 years of consistent software support, yet there is no impact whatsoever on the successor system, if anything it looks like the successor system to a modern console actually does better, lol.

To me this is one of those things that gets drilled into game enthusiasts heads because of the "legend of Sega". It's like adults who make up all kinds of falsehoods to scare kids (like you'll lose your eyes if you sit too close to a TV).

In all honesty the truth is the Sega situation was unique and singular and is not really relevant to Nintendo or Microsoft or Sony. 

A MS/Sony/Nintendo system having an extra year of support or a year less, does not really make a large impact on the company in the big picture. 

Continued success in the market is predicated on high level of execution during console transitions. A company that can do that will have continued success by and large. 

Pertaining specifically to Nintendo, none of their company ups/downs are really related to how long any platform was supported for. Their problems pretty much all stem from bad decision making during console transitions which then manifest into problems the company has to deal with for the next 4-5 years. 

Not using CDs for N64, making a Wily Wonka purple lunchbox design for 5-year-olds for a console, betting the farm on a 3D gimmick and Nintendogs to be worth $250 to people, betting on a tablet controller that didn't do anything really for game play, not seeing the writing on the wall for the casual market when smartphones started to take over the industry, etc. etc. are Nintendo's chief mistakes. Not "well they supported this particular system 1 year less than otherwise". 

You can say that for every successful system ever. Could Nintendo have sold 10 million copies of Super Mario World on the NES? Yes. Could Sony have sold 10 million copies of Uncharted on the PS2? Yes. Would those games have been better off in that situation? No. 

To understand the importance of supporting an existing machine, you have to look at examples in the past that did it succesfully. Those we have are the PS2 and the Game Boy, these existed side by side in parallel with a new generation, and sold well for a long time. The success of these consoles solidified the respective company's presence in the market. The Wii, at the volume of sales that it made, was such a potential for that form of execution.

The converse is also true. To understand the sunk cost of supporting a poor successor, we need to look at examples that failed in the past. For that, we have the Saturn, the Cube and the WiiU. They all were given almost complete resources to continue the legacy and caused great losses to their respective platform holders.

For that reason, the formula is clearly non-binary. In some cases, in hindsight, it becomes crystal clear what direction was winner and which was not. In the case of the WiiU, it would have been better for Nintendo to support the Wii much stronger while launching the U in parallel, by dedicating less resources to it in one shot. You're a gamer, so you understand what happens when using a rare powerful move into nothingness, only to lose the potential that move would have if used in the right moment. I play league, so the comparison would be the use of the Ultimate. If putting all resources on the successor is like an all-in, an ultimate, then the making games only for the U would be like using your ult into nothing. But with the Switch, putting all the resources on it was like using an ult in a teamfight and making a pentakill.

Therefore, it is case by case, and my solution (a unified framework) eliminates all the problems at the root.