Yeah, because the N64 got on just fine, especially in Japan, after Nintendo's 3rd party relations plummeted.

You have to look at why those hardware aspects came to be rather than simply looking purely at who did whatever first and call copycat on everyone else. 3D gaming was on a rapid ascent throughout the mid 90s onwards, analog technology was widely requested by developers, and this doesn't just apply to thumbsticks. Look at the Namco Ne-Gcon controller on the PS1. But to correct the idea you're trying to entertain, the Sega Saturn 3D controller and N64 controller were released within two weeks of eachother, that says more about the way the industry was evolving rather than some redefining innovation a corporation should be credited with. Point being if anything, it was most likely the 3D controller if anything that provoked Sony's initial Dual Analog controller, and for good measure, the Japanese version had rumble motors built-in, again, released about a week after the N64's rumble pak.

And I don't think it's a coincidence that Nintendo became batshit crazy obsessed with horror-themed games during the Gamecube era.

The fuck!? Who thinks this?

Back in the 80s, Nintendo adopted this stray industry it found wandering the streets, abused by its former owners. They cleaned it up and gave it a home, nursed it back to health. Since then, we're just a little overprotective of our baby. We can't imagine it leaving without our supervision. What if some strange men in business suits kidnap it and sell it to the highest bidder?

I'm a Nintendo fan and I don't believe the gaming industry will die if Nintendo isn't leading. However, I will answer your question with another question: Why do Sony and Microsoft fans think that if Nintendo isn't leading it means they're doomed and should stop making hardware?

I don't know if there is a good answer to your question or to mine, other than that some people take the "console wars" way too seriously, and some people are just trolls.

Mainland Europe didn't give much of a damn about Nintendo gracing their countries. Go figure.

So what 80s video game console outsold the NES in Europe?

Sega Master System and Commodore 64. Even if they didn't, my point is that Nintendo basically had a free home run on North America while there were still more than enough viable platforms in most other countries. While there were still shitty unlicensed games floating around here, the good games still outweighed the bad games, it didn't spiral out of control like it did in the U.S. to the point where it deterred people from wanting to play video games altogether. Even through the 16-bit generation, the Sega Mega Drive had a sizeable advantage in PAL territory market share (Europe, Brazil, Oceania etc.) but it was nowhere near as lopsided as the NES in North America.

All I'm saying is, people tend to exaggerate the extent to which Nintendo "saved the industry".

The Sega Master system only entered the race several years AFTER the NES showed the industry was still viable.

The market of videogames needs Nintendo because market needs pure players.
Sony isn't dedicated to video games and is a part of a huge high-tech for general public.
Microsoft is a mega IT company.

which means video games activity is a part of a large activities protfolio of which the aim is only to provide rentability.

Moreover, I think Nintendo feels more concerned about what "gaming" means and gives more importance to innovative features for better or for worse

well to be fair HD development has killed a lot of great studios from the SD days (i.e factor 5, free radicals) who took extreme risks in the hope of a great new IP. If a new IP failed on PS3 and 360 it was bankruptcy, when a game failed on SD well it didn't cost them that much and they could wear/minimise the damage.

What I have noticed now days is lot more sequels and less risk with slight evolution. ATM the only dev who has taken major risks is naughty dog and it paid off for them.

Other studios turned to the mobile phone market and Wii to some degree to release casual games to offset their early HD losses.

Saying all that the industry has adopted now to the new standard and hopefully we will see some growth. I just hope by the end of the gen it doesn't even up being a three horse race of 3rd party publishes EA, Activision and Ubisoft.