They've denied having interest in and even downplayed smartphone games for years. Iwata has said several times on record that they will not make games for smart devices, even as recently as like 8-9 months ago. 

IMO if they were sitting on some Wiimote like idea for the NX that had a fair chance of taking off and becoming a hit, they wouldn't be doing this. 

This isn't some small experiment either, a almost $200 million dollar investment in DeNA may honestly be the largest investment in their company history. They could make a smartphone game or two I'm sure if they really wanted to "test the waters" ... this is a full blown shift in business strategy. 

Interally I think some thing big happened at Nintendo, there probably was a faction within the business structure of the company that was extremely unhappy with the company's current and future business prospects and Iwata came under a lot of pressure to make this decision. I think the whole "well we have this quality of life thing coming" angle simply wasn't cutting it anymore. 

Can the OP change the title to "cornered?" As opposed to "corned."

http://en.wikipedia.org/wiki/Mobage

As they denied releasing a new model of the 3DS a week before its announcement. PR. Until the time was right, Nintendo planned to stick to its guns, but as the market changed and as Nintendo experimented with mobile-like experiences on its own devices, the door opened wider and wider until they felt that they could safely enter the market with harming the value of their games or their brand. (Also, from what I recall, Iwata hasn't made a hardline stance on smartphone games since 2011, with more recent comments showing that Nintendo was sticking out its feelers).

Once again, the statement that Nintendo wouldn't be doing this if they had a "wiimote like idea" is merely supposition. If Nintendo felt like this could be a venue for increasing their brand power and gaining an additional source of revenue, why wouldn't they do it?

Why not make games for Playstation too then? 

This is more the sum result of Nintendo's failure over the past 5 years with the traditional game market and a declining outlook for the future. 

Mobile gaming has been a big money maker for years now, it's not like it was some realization Nintendo just made in the last year. 

And there is still risk here of cannibalization of their market, I think Nintendo at this point simply feels like there's nothing they can do either way to prevent that, so they may as well make money off mobile rather than watch it eat the handheld market entirely. 

Theres a big difference between making games on Playstation and making games on mobile. As I stated before, Nintendo has likely weighed the risk/reward of this move, including the risk of both diluting the brand and losing the "exclusive" advantage. While this has been a worry for a long time, mobile games will likely not be the same type of experiences you would see on consoles. As Iwata stated, they are not simply porting games to smartphones and allowing mario to move with a touchpad. That is not how they are operating, however we do need to wait and see how they will handle this move as there are still a number of unanswered questions.

While the mobile market has been big for a while now, as I have stated, Nintendo has been experimenting on its own consoles and slowly adapting to the new technology. Nintendo are notoriously slow to adapt, and it seems to have reached the tipping point where Nintendo believes that this is a viable model.

As with QoL, this move seems more like creating a more stable company with more revenue sources than feeling "cornered" (or corned) into this situation.

I think it's because they don't see phones as major competitors.  Going mobile gives Nintendo a lot of leverage and breathing room from all sides of media.  Here they are getting blasted on by Forbes, Motely Fools, Times, whatever media outlet is covering them this week for nothing going mobile, not to mention the stockholders and general concerned gaming fans.  Stepping onto the mobile field gets them advertisement, new players, older players that no longer play their games.  Its a way for them to expand at a relatively low cost of entry.  As for cannibalizing their own product, it will be as it is today.  Some will buy the dedicated hardware and some won't, but most likely if you own a smart phone, you would have easier entry point to Nintendo than not at all.  Plus, it's been stated that mobile games and their hardware games are not going to overlap.  It's a good thing.

I don't think this is just a "revenue source". In 3-4 years this could be their LEAD revenue source. Wouldn't surprise me one bit. A lame company like Supercell makes $2 billion in annual revenue from mobile. 

The long term forecast for dedicated portables still does not look good and Nintendo can frame that or spin that however they want, the amount of people willing to carry around a dedicated portable device is shrinking. 

They had no answer to the Apple machine. So they caved and joined in. 

I suspect while they will start a little slow here, after a couple of years of tasting that easy money from ios/Android, their strategic outlook will change fairly quickly too and more and more of the Nintendo IP stable will find itself on smart devices rather than the shrinking dedicated portable market. 

If Apple actually follows through with that patent of a home button that can pop out and operate like a joystick ... it's over for dedicated handhelds as a mass market product IMO. With a directional input, iOS games will be able to handle many more types of genres of games in a more satisfactory manner and that will likely be the death knell for gaming portables. 

It's true... they didn't have to start this venture. But stockholders can be a real nuisance sometimes. There are two ways to view Iwata's comments. Until he is proven to be lying, we must give him the benefit of the doubt and assume he is being positive. Otherwise one might be labeled as a cynic.

It's true. Nintendo wasn't "cornered". The company could've continued to release the games it had been releasing and continue to lose ground to the competition. Nintendo say an opportunity and took it. Opportunities are almost always done by choice and not necessity.