The 3DS will sell well because its taking advantage of the 3D craze/gimmick and Nintendo handhelds always sell well. 

As of right now we have no idea what will make the Wii 2 special or worth buying. Casual gamers need a reason to buy the Wii 2, they won't just buy it because its a new console. The reason most people bought a Wii is because it was the must have toy. The Wii was on every show from Oprah to Ellen Degeneris with people being told its a must-buy. I'm not expecting the Wii 2 to get that type of media attention again (unless it has some crazy new "gimmick") so I don't see massive numbers of casuals buying it.

The PS4 and Xbox 720 should do great next gen though because they have stayed true to their hardcore audience for the most part. With the exceptions of move/kinect the PS3 and 360 have always targeted the hardcore/core userbase which ARE the guys who will buy a next gen console right away.

Depends on too many factors. The only part that should work is that if Nintendo starts the next generation, they should be able to leverage that, as third parties can no longer afford to ignore them and then they can fetch the momentum that is so critical to determining third party support in the long run, then combine that with what will hopefully be exceedingly superior first party support to create an environment where the opposition cannot hope to catch up

Cockblocking on third party support seems to be their strategy with 3DS: get their first and get the kind of third party games that gave the PSP the strength it has (Kingdom Hearts, Metal Gear, FF spinoffs, fighters,) and the theory goes that then the NGP won't have a leg to stand on (or the leg it will stand on is versions of PS3 games made by second or third string developers, as seems to be Sony's MO for handheld development)

Whether this will pan out, we will see, but that could be an applicable strategy in the console space, though in the console space it's more about achieving multiplat parity, and then edging out the competition with your superior first party brand name strength

Basically: Will Nintendo move first, will Sony and Microsoft overshoot the market again, and if so, will 3rd parties follow the overshoot creating the unsustainable clusterfuck that is this generation?

I seriously expect Nintendo to utterly wipe the floor with its competitors (which does not include Apple) in the eighth generation. This is the first time that Nintendo starts a generation with as huge a fanbase as they do, as much money as they do and as many massive IPs that its competitors couldn't ever even think to dream of as they do. They'd have to mess up big time to not lead now and, considering they've only done that twice ever, and they have an awesome CEO in Iwata now, I wouldn't say that's very likely.

That is a good point. Nintendo has a huge advantage next gen in that respect. All they really have to do is boost the graphics to 1080p, increase the processing power and throw in the vitality sensor/upgraded wiimote and they're good to go. I think if they just did that next gen they would be off to a good start but I think they still need some kind of killer selling point (like motion controls were) to crush the PS4/Nextbox like they did this gen and get that "must have" status again. 

I know there is of course the Nintendo faithful i.e. the guys who bought the Gamecube and aren't bandwagon jumpers who will buy the next Big-N console but I am seriously worried (for Nintendo's sake) that casual gamers won't upgrade their consoles for a while. 

What would you describe as the "right things" that they need to do?

It's funny how people think Nintendo will easily win next generation. I bet people thought the same in late years of PS2 about Sony.

Also people seem to ignore possibility of  MS and Sony userbase being more loyal to their systems after years of building friendlists, achievment, accounts with tons of DD content whie such ties will be much smaller for the Wii fanbase.

We're going off what's knowable. Wii really came out of left-field, and a game-changer like that from anyone is unlikely unless Apple up and enters the console market. Only one lucky April Fool's author at GameSpot knew the truth, but no one else saw that coming

Though it was also unknown that Sony would break the bank, but you can't predict poor decisions either

With the rise of smartphones, Nintendo could be in real trouble in the future. I mean, videogames are all Nintendo has, and the DS must make up atleast 50% of their revenues. I don't expect a new handheld generation after this one... the 3DS and the NGP are the last... also, based on actions by Sony (Playstation Suite, Xperia Play), they are thinking the same way as me.

If true, this means that, unless Nintendo diversify, the only product that they will have is their home-console. Both Microsoft and Sony have shown in the last year or so that they're committed to merging their different products through networks, media sharing, etc... Nintendo doesn't have that ability (they can reach out to third parties, but this is obviously more costly than having your own products). Both Sony and Microsoft have also been aggressively targeting both the casual, and the core market. Microsoft, in particular, have done exceptionally well: they pretty much own the core market in the USA and UK (1st and 3rd most important market), have a strong share throughout the rest of Europe, and, since Kinect, have also managed to tap into the casual market.

I do think that unless Nintendo changes their business model, the golden days are very much behind them. Maybe if they were to go with the Disney route, they could diversify into markets such as television, movies, theme parks, stores, etc. The issue is, with only one product out there (the home console), they will be less likely to take the risks necessary to produce the next Wii. Wii exists because DS was so profitable.

I find it funny how after all these years, people still underestimate Nintendo

People said the DS was going to flop, sold more than any other gaming system in History

People said the Wii would flop, sold out the PS3 and 360 and is likely to sell over 100 million

People said the 3DS was in trouble due to the Iphone, and it caming roaring out of the gate

I think its pretty clear that its Nintendo's lead to lose, even now, the Wii's sales have nothng to do with MS and Sony and verything to do with its own lineup (the Super GCN games).

what only the 3ds and ngp are gonna be considered handhelds the android phones and iphones are phones lol with games on them . i think nintendo will continue to lead in handhelds but the console thing is to crazy who knows with that.