The difference is that Japanese cars aren't inferior to American cars. They can do anything that an American car can do, and for a lower price with a better fuel economy.

More people watched Charlie Bit Me on YouTube than 99% of films ever released in cinema. And yet, YouTube has not destroyed film. A short and enjoyable minigame is no substitute for a deep, varied, fascinating and enjoyable long experience.

These games's appeal will not last, but it does represent a threat in the sense that it makes the consumer think they don't have to pay for content.

Big Three? Why are you talking about cars :P

Should have an answer that says they won't be a big influence either negative or positive on console gaming.

Of course it helps. It takes farmville 300 million users to make $100 million/year. It takes Nintendo 1 million users to make $100 million/year. There's a reason that a company like Zynga was completely unknown before making farmville is the company that made farmville. The big 3 are working with bigger and better things and wipe their butts with games like farmville.

I think that  will look at what attracts people to Zynga games, incorporate it into their games, and continue making buttloads of money while attracting customers. All they have to do is convert a small fraction by word-of-mouth, or get their current users to buy one extra game, and they will make as much revenue as all of Zynga.

Yes, that is currently the case.  That's my point.  Because as any student of automobile history can tell you, such was not always the case.  The original Japanese cars were runty, underpowered, unattractive looking, more prone to breaking down, and generally inferior to their American counterparts.  I say "generally" because they were better in a few key areas: they got you where you were going, but at a fraction of the price.  Those people who couldn't afford a Real Car, but who wanted/needed an automobile, were the Japanese' early market, i.e. people who were in a different market.  It was only as time went on that the Japanese, who now had a steady base of otherwise-ignored customers, were able to improve their cars until they first matched, and then exceeded, their American counterparts. Which of course means that the two "different" markets were never really different to begin with, they were just on different spots in the totem pole.

I suspect you're starting to see where this is going.  But to drive home another point...

You're missing the forest for the trees here.  Youtube and other streaming sites are not going to "destroy" movies.  What incentive do they have to do so?  On the other hand, it is quite possible that they will greatly influence how movies are made in the future. 

Take a look back at how television influenced the movie business.  Studios began producing many more hours of television shows than movies (something that's true to this day).  Movie theaters began to go out of business, which prompted movies to raise their budgets and try several gimmicks to lure people back: it is no coincidence that the lavish Hollywood Epics (Spartacus, Ben Hur, Dr. Zhivago, Lawrence of Arabia, etc.) all popped up at the same time that television became ascendant.  It's also no coincidence that the same time period saw the widespread introduction of color ("Now in Technicolor"), 3D movies, and bigger, widescreens.

The point of these brief history lessons is that one part of a medium does not have to destroy another part in order to alter the latter.  Some may like to console themselves with the thought that mobile and browser games are somehow different than the traditional handheld/PC/console market, but the simple truth of the matter is that they're all made by the same folks.  Do you know that the percentage of game developers who are working on mobile games literally doubled in 2009?  25% of them were in that market, a figure which I believe rivals or exceeds the amount who worked on the market-leading console.  And from all indications, that number has increased in 2010.   Even major companies like EA have spent billions (with a "b") of dollars into trying to get into the browser and mobile markets, to the point where they're opening studios specifically dedicated to those media.

If game developers are getting detached from "real" games to work on mobile games, as is currently happening, it's inevitably going to have a big effect on traditional gaming.  Some may insist to their hearts' content that the two are somehow different, notwithstanding that even game journalists (arguably some of the most "hardcore" gamers out there) are often devoting more time and energy to the medium, but if the developers aren't around to make as many games as before, we won't have as many games to play.

I say yes they could be used as a gateway drug. Smaller games can probably be there for the people who think they dont have much time and use it because it doesnt take too long. Then they could get more interested and realise that they can make time for bigger games. In that sence i find it a very good idea but i am also aware that this is a tricky and debatable subject. Overall though i think it is a good idea. But and this is a big BUT the "big three" would have to be extremely careful in making sure that people dont just play on the tiny games because they are soo addictive or put them off because they arent very good but make them good enough for people to want more and go for larger scale games without leaving them at the "tiny game" stage. I dont actually think that the big three will ever run out of business because i will always be into the larger more complex games.