Michael Pachter has been laughed at endlessly for his belief in a Wii HD among other ridiculous statements. For the longest time people just called him stupid, but some months ago that changed. What if Pachter doesn't say this things because he is stupid, but rather to influence people's perception of the market?

Now what if the same holds true for third party publishers when it comes to Wii support? Early on it was easy to just say that they are stupid and don't get the Wii, that's why their games are so lacking. But, as with Pachter, over time it's hard to believe that that is the case.

Here's my theory: Lack of sales for "mature" or "hardcore" content on the Wii as well as lack of processing power are named as excuses to why the Wii isn't getting particular games, but those aren't the real reasons. Third parties know that the Wii is a threat to their core market on the HD consoles. If they provide similar content on the Wii, eventually it's going to start to eat into the sales of their HD games and they don't want that to happen after they invested so much money upfront into the 360 and PS3. Thus they deliberately deny the Wii games that would sell and also don't shy away from setting games purposefully up for failure.

This theory is backed up by:

1) The PSP getting its own versions of games like Soul Calibur, Assassin's Creed and Split/Second while the Wii does not. The PSP sells undoubtly less software than the Wii and its processing power is also below the Wii, meaning HD games have to be redone to run on the PSP. This undermines the excuses third parties usually give.

2) The almost complete absence of the popular genres on the HD consoles on the Wii. FPS, TPS, sandbox and action titles, racing and fighting games. It's hard to find such titles on the Wii, there's not much choice. What is there consists of B-team games (Call of Duty), bastardizations (Need for Speed: Nitro) and games made by developers who can't afford to make HD games.

3) Changing the genre of a popular IP to make a Wii spinoff is also a popular practice. Soul Calibur Legends, Castlevania Judgment and Dead Space Extraction for example.

4) Ubisoft's recently announced Ghost Recon game for Wii, because that one really is set up for failure. Low production values coupled with being on rails and that way after the collective complaints from last year that sales for on rails games on the Wii were decreasing more and more.

5) Epic not porting the Unreal Engine 3 to the Wii, but to the iPhone. I am pretty sure that Epic would be able to charge higher prices/licensing fees for UE3 if AAA games remain on the HD consoles instead of moving to the Wii. Thus the Wii also posed a threat to their core business, unlike the iPhone which eventually got its version of UE3. Not that third parties were really interested to make AAA games for the Wii anyway.

For years we used to say that third parties were caught off guard by the Wii's success and that's why certain games didn't make their appearance on the Wii, but that excuse doesn't hold up nowadays. This is 2010 and all the genres that are present on the HD consoles should have arrived on the Wii by now.

Are you insane?  The Wii doesn't offer that?  Carnival games was an insanely huge win for whoever made it considering initial investment.  With HD games, they don't go big unless it's a $10 million game.  How many people buy lottery tickets because they're "cheap" and "could win the lottery"? 

I'm busy so will have to reply to the rest later. 

Take an average sale price which is $37 for third party games (and dropping?) then consider you have a lot of games which sell fewer units and therefore find themselves in the higher royalty rate bracket. Then consider that a trickle of units every week (legs) is far more costly in terms of shipping and production than simply making 500,000 units and shipping them at once. Finally consider that as third parties they have double the total number of sales on the Xbox 360 and PS3 with PC sometimes as well, combined, at a faster rate, with a higher average sale price and with the opportunity for additional revenue from DLC. Since the variable costs are lower relative to the sale price it could be as high as 2- 300% of overal Wii revenue for FY2011.

Another answer, people are monkeys and monkeys are irrational.
http://www.ted.com/talks/laurie_santos.html
They are apt to take risks when it involves losses if it also includes the possibility to win big. Since the WIi doesn't offer that, they chose the HD consoles.

I don't know why are you nervous. Third parties do exactly what you say. They release cheap carnical games alike titles banking on easy profit and minimal risk.

Bingo. Third parties have to try their hardest to prevent investor revolt, when they have a bad quarter, savvy investors are going to first and foremost ask why they're ignoring 48% of the console market. So they tossed a few low-budget bones out there, and it was a win-win scenario. If their crap somehow managed to catch on, hooray, we've got a low-budget hit (2K games, foremost in the piss-poor supporters of Wii, lucked out there with Carnival Games), and if they fail, then hooray, they can justify ignoring Wii to their investors, and they don't lose much money on it (Bandai-Namco hit that note with Soul Calibur Legends, and EA did tremendously with Dead Space Extraction)

To up the ante, they hire market "analysts" like Pachter and Divnich and Frasier, who then tell the investors to their face that high-quality Wii development is a bad idea.