It's a niche product, it's not the future of the switch, it's not going to be the main focus of Nintendo, and it's perfectly fine, and Nintendo knows that.
It's not like just because they offert something for kids to enjoy, they will drop the core players. I'm pretty sure they will keep labo as far as possible from their main line of games. I don't think they will start to incorporate labo function in other games than the ones specifically labelled as labo. Don't expect the camera thing in Pokemon snap, or the bazooka thing to work with metroid 4. Or if they do add a labo function in other games, it will be as an after thought, not at the centre of the game design.
But one thing I expect now is now that Nintendo showed us a whole new way to use the joy cons that nobody have though before (just last week I told someone that the ir sensor in the joy on was never use, and that it would probably be dropped in next switch versions), that indies and maybe bigger devs might use it in their game for sonething other than cardboard.
The durability is what I heard the most but the thing that worry me the least. It's cardboard. First cardboard is not that fragile. Especially when you fold it. Take a box, fold if two or three time and try to break it, you will see how tough it is. Then even if it's break, just use friggin tape to repair it. Or take a regular cardboard and cut out a new piece from it to replace the broken one. Or if you have enough cardboard and patience, draw every parts on a regular cardboard and make your own kit.
The price is the other thing I heard the most. Honestly it's not that bad. Go to toysrus and check the price of the toys for children age 6 to 12. It's just expensive. I paid something like 30$ for a Barbie playhouse made of cardboard once. And there was far less cardboard in it, and there no software. And people, be realistic. What are you really paying for ? Cardboard yes, but the cost of the packaging, the cost of the physical cartridge, the cost of development of the game, the cost of the design (they have a team to come out with these design that must work very hard to come out with functioning design, it doesn't take two hours to get from a cardboard to a functional piano, it take a lot of time ans testing). Plus, think of what it give you. For 69$, I got maybe at worst 5 or 6 hours of gaming, 3-4 hours of building, 2-3 hours of drawing and playing with the thing without the video game part. That's at least 10 hours of fun. It cost me like 50$ to bring my two kids to the movie theatre and watch a 1 hour and half movie. In dollar per minute, labo win hands down.
So I think it have potential, and think we will see a lot more of those. From now to holiday season, they will have a lots of design out there, the concept will have the time to proof itself, and it will sell more from November to January than April to Octobe.