I've been on this theory for the past few years that Nintendo's audience (which includes both "fans" and "general consumers") care just as much about hardware as they do software, despite the common misconception that that isn't the case. The difference is: they care about hardware convenience, more so then necessarily "power" (although power can factor into how convenient a product is). OK, that is simplifying things way too much because every popular console has it's own brand of "convenience" to the consumer, after all at the end of the day all consoles are about convenience. But the perceived convenience of something like a Playstation is about being as powerful as possible while still being cheap and mass produced. That form of convenience doesn't land for Nintendo or their consumerbase as well, Nintendo has basically positioned themselves so that there is no way their products can be convenient to their audience without being different. There is absolutely nothing convenient about a console where the controller is a tablet with features that nobody uses, with that tablet and those features jacking up the price, with most of the marketing being geared towards an audience which has all but left the traditional gaming industry by now. There is nothing convenient about a mini cube that, no matter how good the games are on it, is playing the same game as two other competitors with much deeper marketing pockets that have more third party support or innovative features. I guess you could say the Gamecube losing to the Xbox had less to do with convenience to the consumer and more to do with Microsoft's deep marketing pockets, but in general Xbox and Gamecube being so far behind the Playstation 2 showed how little the actual hardware had to bring to the table in terms of convenience to the user. There is nothing convenient about a console that is more powerful but has a significantly smaller selection of games than the competition and also has those games at prices that are often much higher than CD games as well (and I mean MSRP for virtually all games, not just "Nintendo never does sales on their first party games!").
Nintendo's brand of convenience is about form factor, "uniqueness" (not just in product but in position in the market), and cheap prices. That's basically how you make a modern successful Nintendo system. And it's why the Wii U, Gamecube and N64 either failed or didn't live up to their standards. It's also why the 3DS needed a big ass push behind it in order to get it lifted off the ground. DS-type games and 3D effects weren't going to carry it. For all intents and purposes it wasn't actually as convenient or appealing to the consumer as it probably should have been, which is a big reason why it didn't hit the 90m+ mark I think.
Software sells hardware. Hardware also sells software. Go figure.
