Splatoon needs to be a hit first. Easy to forget that games like Mario Kart and Smash Brothers were birthed on relatively successful platforms (the SNES and N64), the Wii U has nowhere close to the userbase of those systems. 

And Nintendo did create a Street Fighter/Mortal Kombat clone, it was called Killer Instinct and it was fairly successful until the 2D fighting genre as a whole fizzled out. 

Nintendo is more than capable of supporting a singular console but they don't, at current, have a singular console.

They alone are capable of seemingly producing a steady high quality stream of games while still balancing two consoles. What's Ubisoft going to do? Fart out another overhyped game every year? In the time that Activision, EA, and Ubisoft produce one over budgeted game that they more than likely wouldn't even bother porting to a console audience that has been neglected/disregarded by said publishers (this is a real thing), Nintendo will have produced an order of magnitude more games. Nintendo will not ever be able to court the "dudebros" who buy said farted out games either, they already have a home and chasing them with "powerful hardware" is a fool's gambit. They tried power with the GameCube, it had the same exact RISC/PPC architecture as the PS2, it got all the same games as the PS2 while the competition was still a thing, they didn't magically win. Third party games didn't magically sell better.

Where is the evidence over concessions? In the very fact that third party would want Nintendo to entirely change their own hardware development tools from what has suited Nintendo for over two decades, to x86, throwing out two decades of games cataloges and tools that have been built on RISC rule sets. AAA western devs want homogenized hardware across the board because then they don't have to put in any effort in ports, and their titles are immediately available to all audiences. No doubt, too, they would also expect Nintendo to partake in bidding wars for "exclusive content" and whatever other bullshit AAA development has devolved to at this point.

Yamauchi and Iwata both have realized that "power" is not what makes a console. Aside from the PS4 (pending) power has never even been the "winner" in console generations.

Took you long enough to say this. Exclusive Star Wars games would have to  be worked into the deal. Star Wars is still kind of a big deal.

Stop saying "third parties". Its AAA.

Third parties exist fine and dandy on the WiiU/3DS, they just don't have budgets that can skewer the moon.

Yeah sure, why not. Turn it into a Nintendo-Disney console, Disney encompasses so many brands that would be valuable to Nintendo if done right ... Star Wars, Indiana Jones, The Avengers, Spider-Man, X-Men, Guardians of the Galaxy, ESPN sports, Pixar, Pirates of the Caribbean, etc. etc. 

I think Disney would be down for such a deal too. If the Disney IP could operate sort similar to how Rare was to the N64 in the 90s ... supplying 2-3 badly needed good to great games per year, it would expand Nintendo's appeal tremendously while allowing them to take more time and risks with their own software. 

Throw in Japanese third party support like Monster Hunter, Yokai Watch, and Dragon Quest and you have a platform that can appeal to a fairly wide audience base. 

1. They are not capable of supporting a single console, you can combine 3DS and Wii U first party releases and its not enough to support a single console on purely those games.  Also with the next console being more powerful there is gonna be even less of those games.

2. Third parties like Ubisoft/Acitivision/EA supported the Wii U at launch even though it was a pain in the ass to port games over, eventually they were like this isn't worth our time.  If Nintendo's console was x86, ie easy to port games over it wouldn't have to sell a lot to be profitable.  Don't use that GC arguement, I already refuted it in this thread, hell I already refuted a lot of what your saying, you should actually read the thread.

3. Also no duh developers want it easier to port games over?  Who cares if it throws away Nintendo's back catalog, their eshop support on the Wii U has been crap anyway and it is not a system selling feature.

Your mixing in too much of your personal hatred for third parties into this.

Youre half way there. Third party aaa titles are the issue and third parties made it clear that no one was getting them unless they followed suit with console power.

Third parties support the 3ds because the games are cheaper to develop and the risk is lower but the install base is very high. Nintendo barely has competition and they always thrive off of that just as they did on consoles before the playstation came.

1. I never said purely on those games. They have other development channels, they have outsider developers who develop. With scalable form factor hardware that unifies their development channels, will also apply to the many developers who still produce games on the 3DS, they're not going to disappear. The point is that Nintendo produces considerably more games than any other developer for their systems, they dwarf the production of Sony and M$.

2. You haven't refuted anything with regards to the GameCube. Its literally the exact thing you're arguing for and it failed. Gamecube form factor discs are literally an irrelevant inconvenience and, as last gen showed us, not one that matters. X360 also needed multi-disc games from their third party developers, didn't seem to impede their support or FFXIII at all. GC and PS2 were both RISC tool sets on PPC chips, X360, PS3 and Wii were the same except the bizarre choice to use Cell with the PS3. Porting from Cell would have been harder than porting from GC to PS2 or the other way around. The GC was literally built to accomodate third parties and all the things that PS1 did right and that N64 did wrong.

3. The WiiU's eShop has been crap? I don't think you use the eShop. Your argument for homogenization is folly. You're basically arguing for "why do we even need multiple consoles".

The other thing to consider is that x86 sucks for mobile, small form-factor. If Nintendo wants to merge platform development channels they can't have two different chipsets and rulesets running as they do right now with the disconnected chipsets of the WiiU and the 3DS. x86 on a handheld would be a crapshoot with worse battery life than the Vita. PPC/ARM are far better for that, it also opens up their compatability to the much larger mobile market than the limited, self-destructive AAA development.

No they appealed because of the wiimote. Nothing japanese about that. Hell outside of Nintendo there werent that much Japanese games that did gangbusters in the west anway. So im not sure where you are getting that from.

Do they now? What games are these companies putting out for the WIi U soon? There own games, not something Ninty paid them to do like a fancy mercenary. THe next Resident Evil is skipping BOTH Ninty platforms as far as I know. Doesnt seem the new Tekken is heading to WIi U either.