That just shows that Sony/MS were burning through money and throwing money around to get ahead. 

XBox was horribly designed hardware from a cost POV that was bleeding huge amounts of cash that even Microsoft said "uh no, this has to stop". 

Sony was just weaseling 3rd parties into exclusivity contracts. 

You can see then why Nintendo went "fuck this bullshit" and didn't want to be part of that continuing pissing match. What were they supposed to do, lose $200 a console like MS was and go bankrupt ala Sega or get into a bidding war for every major third party game with both Sony and MS. 

They made a great piece hardware with the GameCube, far better than the PS2 while being cheaper than the PS2, easier to program for, and essentially all that effort was for basically no gain.

Nowadays this kind of thing wouldn't fly either because there's much more retail stock investors that watch financial returns like a hawk, so if you're bleeding tons of money, share prices can immediately be hit, back then I think companies like MS and Sony had more cover to waste shit tons of money and kinda be given a pass for it. You don't really see Sony being willing to take big losses on hardware anymore for example. 

Nintendo was in no danger of going bankrupt with Gamecube. Also while Gamecube had the worst 3rd party support it's 1st party was mighty strong as usual with Nintendo consoles.

Because the hardware was very well designed and cost efficient. If they did what MS was doing and losing like $150-$200 per console, sure they would have gone bankrupt because that was an ass-backwards way of running a game division (MS hasn't really gotten much smarter since then which explains why they are now on their way out have accomplished a whole lot of nothing). It's not really surprising now looking back on that time that they decided they couldn't just keep sticking with trying to be in a pissing match with MS/Sony of that time. Today things are a bit different. 

The 1st party support of the GameCube was actually a big problem, it wasn't good enough. Mario Sunshine/Wind Waker/Metroid Prime/Smash/MK Double Dash were a big step down sales wise from Mario 64/Zelda: OoT/GoldenEye 007/Mario Kart 64/Smash 64. Smash Melee is really the only Nintendo IP that saw a growth in sales. They just weren't on their game that gen. They needed what Mario Galaxy was instead of Sunshine and they needed Zelda: Twilight Princess, not Wind Waker, and even with that they'd be hurting with no GoldenEye 007 equivalent. 

While I did really love some of Nintendo's first party games that gen like Metroid Prime 1/2, Luigi's Mansion, and F-Zero GX, they really needed an epic Mario 64 successor like Galaxy or Odyssey, a "serious" Zelda (Twilight Princess pretty much, but that arrived too late) Mario Kart and DK games that weren't tied to a meh gimmick, etc.

It was a case of not reading the room, much like Wii U. They made what they wanted to make instead of listening to what the audience wanted.

It matters a huge fucking deal.

1) CPU cycles spent decoding video is cycles not spent decompressing textures.
2) CPU cycles spent decoding video are CPU cycles not running A.I. routines.
3) CPU cycles spent decoding video are CPU cycles not doing Physics.
4) CPU cycles spent decoding video are CPU cycles not doing post-processing on the CPU. I.E Morphological Anti-Aliasing, Bloom etc'.
5) CPU cycles spent decoding video are CPU cycles not doing shader compilation.
6) CPU cycles spent decoding video in software consumes more power than on a dedicated hardware block.

The point is, it could be done on all the consoles, making it a redundant "advantage" for the Cube.
Arguably, the Original Xbox could do it better in software thanks to it's more flexible and extensive SIMD instructions anyway.

Lossless Audio has always been a space hog... Remember when the 8th gen consoles launched, Call of Duty had 30-40GB of it's install footprint as just lossless Audio?
Yeah. It's shit. But it's the world we live in.

...One could argue high quality Audio is less important these days as people have resorted to using TV's built in Audio or garbage Sound Bars... I haven't seen a 7.1 Audio system (Other than mine) in the wild in over a decade.

Size of data is all relative.

Consoles have stagnated for decades on drive capacities, which is why it stings more.

As for a "Junk Laptop". - Remember when Intel released the Intel Pentium MMX in `1997? They had this thing called "MMX"
MMX is a set of extensions which is used to accelerate things like Video decoding, hence why a "junk laptop" especially one with more advanced SIMD like SSE could do MPEG-4 without much drama.

Consoles however are fixed hardware devices, you can't just drop in a new CPU and get better performance.
So any CPU cycles you invest into things like video decoding... Means the CPU isn't allowed to spend cycles on something else.

The consumers were the winners because of that.
That should be celebrated, not shunned.

The more hardware we get for our dollar, the better.

The fact you are celebrating getting less hardware for your dollar is just bloody bizarre.

Are you the kind of person who is happy paying more to put fuel in their vehicle? Paying more for their Mortgage? More for their Electricity? More for their Groceries? No? 

Think about it.

You seem overly defensive of all things Nintendo and make a lot of silly comments.

Sony was not burning money with the ps2, they were making millions of dollars. 

The ps2 had a superior lineup, it is OK for Nintendo not to be the best all the time.

The larger point is the ps2 was the weakest hardwsre but the best option that gen.  Power doesn't mean much without software.

Sometimes I wonder about you and Nintendo consoles.  First you didnt know the S2 was $450, now you seem unaware that Twilight was a gamecube game.

The N64 sold well because Nintendo was a household name at that time, coming off the SNES.  But the N64 lineup was super weak from a volume perspective, the ps1 killed it. 

So Nintendo, going into the GC, didn't have their great reputation, Sony took their crown.  The reason the GC didn't sell wasn't because no Goldeneye, it was because Sony was the household name with the superior lineup.  

The n64 and GC had great exclusives, but their third party support was garbage compared to Sony.  

Plus at that time Nintendo was splitting their software between home and portable.  What makes the switch great isn't the hardware, it is the software no longer being split between two platforms.  

Edit

And of course over the years Sony has lost a lot of exclusives to PC, Nintendo and MS.  Which reduces the value of owning their hardware.  This especially true with the rise of indie games.  

Hardware has never mattered, software does. 

Yeah software has always mattered more than hardware.
Gameboy, NES, PS1, PS2, Wii, DS, 3DS, all weaker than their competitors yet won the day thanks to offering the games people wanted to play.

Nintendo tried twice to beat Sony head on and failed badly. It also did not have the money Microsoft has to throw around so its blue ocean strategy is clearly a necessity.

Blue ocean strategy has been over for like 10+ years (chasing soccer moms/non-gamers). That's an even redder ocean these days as the Wii U/3DS found out the hard way because Apple and Android dominate that now and those two are far bigger than the Sony's of the world. 

Switch is just a natural melting of the Nintendo traditional home console + portable, which was always going to have to happen as the complexity of making games would have made two bespoke libraries of games impossible.