They are already beyond in the online. They have their own social network with a group messaging system. And Miiverse?

They are only behind population wise. Functionaly, the Wii U's online will be ahead.

"Looks better" is a matter of opinion. Design, translates into "looks better", not hardware strength.

Most PSX games relied heavily on CG and stills. What looked better were the CGI sprites and backgrounds. The pure 3D PSX games couldn't hold a candle to N64 games.

Nintendo just need give us good games and everything will be fine Reggie. Don't make us wait like you did with Xenoblade Chronicles.

It wasn't due to superior graphics that the 64 failed NN. It was due to the media format and hardware limitations. Case in point actually a gimped system the N64 was for most 3rd parties, and that ruined it.

The Wii is weaker in all respects, not just an important one like the 64 was (game media). That's worse. However the Wii compensated by catering to a new market, something that was also possible on the N64. So the Wii's success in the new blue market has nothing to do with Nintendo's continued failure in the traditional red market. As a reminder, the success of the unproven Wii in the casual market was a shock to all, believers and non-believers alike. However they won't strike gold twice since users already own the Wii. The U needs to be a significant HW upgrade otherwise there's no incentive to buy. Well, that and alluring SW exclusives.

Of course, but for most applications the PSX offered more technology the companies needed for the visions of their games than the N64 did, bottom line, be it more polygons, more data on disk, better sound support, better in-game-video support, better 2D backdrop support, etc.

The lesson I allude to isn't that superior graphics are an automatic failure. It's in the importance of superior graphics, or the large lack thereof.

No, they still aren't. You are misintepreting the meaning of the words.

They just finished being berated for graphics for 6 years. He is stating that this console will not be graphically weak. Its more about reasurrance than anything else.

It's a complex topic, and really not that simple. You first have to categorize it by market. Casual games don't need superior graphics. However, games in the Red Ocean, the market the SNES was initially catering to, that market needs good HW capabilities, be it graphics, memory, what have you.

In the Red Ocean market strictly: Then it's the fact that the N64 suffered from a parallel problem to the hypothetical problem of superior graphics, and that was a wrong choice of media format. You will blame better graphics when the root cause was other. In other words you'll say that the N64 failed due to wasted cost in superior graphics, when it really failed due to the wrong choice of format mostly, and launching later than a higher-value system to 3rd parties (the playstation). Would they have had the very same problem with inferior graphics. Yes, and it would have been worse in fact.

EDIT: Could the N64 support the blue ocean strategy? Yes, but prohibitive distribution costs would have likely made that strategy mostly appealing only to Nintendo, since 3rd parties could pursue that on the competing console (which they did).

“It’s based on having great graphics, it’s based on having a robust online execution,”

Then what the hell have you been doing the past 6 years!?

I'd like to point out that Factor 5, Boss Games Studios, Iguana Entertainment, Midway, Angel Studios and  LucasArts pushed the console pretty damn hard too.