Nintendo itself would survive just fine as a third party publisher.

However, since they wouldn't have to provide their consoles with games anymore, don't expect them to produce much else than Mario or Zelda titles anymore (plus Pokemon, Yokai Watch and maybe Splatoon and Fire Emblem) as then they will have to make sure their games make a steady profit. Which would already be risky (for their investors, probably not so much for Nintendo themselves) with Kirby, Donkey Kong or Paper Mario and would only be released once in a long while. Metroid, Star Fox, F-Zero, Chibi Robo, Pikmin or any new IP to name just a few? Wouldn't be worth the trouble anymore, so don't expect any of these games to come out anymore if Nintendo goes third party.

Also, the quality might suffer as they wouldn't need to be pitch perfect anymore to make their consoles really sell.

Based on sales on this site in the game database so not official and not 100% accurate but it should be relatively correct. These numbers are rounded.

PS4 software-226m, XB1 software-121m, Total-350m

Action, PS4-75 million, XB1-30m, Total-105m

Shooter, PS4-60 million, XB1-45m, Total-105m

Sports, PS4-40 million, XB1-20m, Total-60m

3 genre total, PS4-175m, XB1-95m, Total-270m

That adds up to about 77% of all retail sales coming from these three genres.

And what you have layed out here would be a very sad Nintendo! Let's be real, Fire Emblem is a decent sized franchise because it's on Nintendo platforms. Nobody on Playstation or Xbox is checking for such a Japanese strategy RPG. They don't even want Final Fantasy to play like an RPG, everything has to resemble an open world action adventure game now.

You have pointed out exactly why it wouldn't be worth it for Nintendo. The fans of those consoles don't buy anything else unless it resembles 1 of the top 3 genres selling. This is fact and the numbers prove this in black and white...

Fire Emblem might survive pretty well in Japan, that's why I put a maybe there. I wouldn't bet on western releases anymore too if Nintendo would go third party, though.

And the trend for those overly actionyzed RPGs is why I play older RPGs (and I mean really older RPGs, mostly stuff from the 90's on PC) but none of them. We had that trend before in strategy games: Before Command & Conquer and Warcraft, almost all strategy tiltes where turn based. Good luck finding any such games anymore which aren't 4X titles. Too bad since turn-based wargames where and still are my favorite genre, but I'm stuck with Panzer General and Battle Isle for all eternity it seems

Yep basically a AAA game has to be an open-world action or online-focused shooter (or combination of both), which makes me believe that very few Nintendo games would see notable increases in sales.

I think the decline in quality would go down, as currently Nintendo have to work really hard on their IPs to make sure their console does well- it depends on it.

I highly agree with your statement and I don't think many people acknowledge that first and foremost video games are a form of art that comes together for our entertainment. Now I know that some of Nintendo's ideas have not panned out to be hot on the money or popular in first opinion, but this is where they draw their inspiration from to design games.

They don't develop their games like Sony and Microsoft do, if most people here have ever watched a Nintendo developer diary. These guys will play around with unique control ideas and mechanics first without even thinking about which franchise suits it. Remember that old Mario 128 software demo and how eventually that game became Pikmin.

I could see them making tons of money from exclusive marketing deals for their biggest franchises as is the case with most publishers today. In fact Nintendo could easily become one of the biggest if not the biggest 3rd party publisher with their brand recognition on systems with much bigger install bases than their own.

Its not just install base, its also audience and demographic that determine how well a game sells. Like i pointed out a few posts back, close to 80% of PS4/XB1 retail software sales are from the shooter/sports/action genres. If you also include Racing Sims & Western-RPG than that number comes close to 90%.

A whole bunch of Nintendo IP belong to genres that arent very popular on PS/XB, platformer, puzzle, party, simulation, strategy, miscellaneous.

Their big mainstream hits like 2D/3D Mario, Smash Bros, Mario Kart & Zelda could increase in sales but games like Mario Party, Pikmin, Fire Emblem, Rhythm Heaven, Animal Crossing, Paper Mario, WarioWare, Kirby, Yoshi, Donkey Kong, Tomodachi, etc? I dont really see these games doing much if any better.