Without question, the biggest mistake is Ninetndo backing out of the deal with Sony for the CD ad-on, giving Sony the reason to start the PS1.

Nintendo put Sony in the gaming market. Ops :p

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

The SNES-CD was to be announced at the June 1991 Consumer Electronics Show (CES). However, when Hiroshi Yamauchi read the original 1988 contract between Sony and Nintendo, he realized that the earlier agreement essentially handed Sony complete control over any and all titles written on the SNES CD-ROM format. Yamauchi decided that the contract was totally unacceptable and he secretly canceled all plans for the joint Nintendo-Sony SNES CD attachment. Instead of announcing a partnership between Sony and Nintendo, at 9 a.m. the day of the CES, Nintendo chairman Howard Lincoln stepped onto the stage and revealed that Nintendo was now allied with Philips, and Nintendo was planning on abandoning all the previous work Nintendo and Sony had accomplished. Lincoln and Minoru Arakawa had, unbeknown to Sony, flown to Philips headquarters in Europe and formed an alliance of a decidedly different nature—one that would give Nintendo total control over its licenses on Philips machines.

After the collapse of the joint project, Sony considered halting their research, but ultimately the company decided to use what they had developed so far and make it into a complete, stand alone console. As a result, Nintendo filed a lawsuit claiming breach of contract and attempted, in U.S. federal court, to obtain an injunction against the release of the PlayStation, on the grounds that Nintendo owned the name. The federal judge presiding over the case denied the injunction and, in October 1991, the first incarnation of the new Sony PlayStation was revealed. However, it is theorized that only 200 or so of these machines were ever produced.

Yeah, you can only do so many games at one time. They hadn't done Warcraft in a long time, so they did WC3 and WoW. It's ok... Even if you are upset, it's not anywhere near a big mistake in gaming.

"5. Blu-Ray as the standard for the PS3"
i see the as not a mistake but as something that should be applauded. PS3 won the format war for Sony. That is def not a mistake

Jeez, you guys forgot the biggest mistake of them all:
Nintendo backing out of the SNES CD drive deal they had with Sony, which made Kutaragi say: you know what, we'll make a console of our own.

big fail for Nintendo.

And he who thinks blu-ray was a mistake, I'll talk to you in two years time.
Blu-ray will sell millions of consoles, is the biggest + PS3 has over 360, and puts MS in a very bad situation when releasing their next console. Because yes, it will have to contain a blu-ray drive, and a % of their hardware and software sales will go to... SONY!

Soblu-ray a mistake, I don't think so.

EDIT: trip hawkins selling EA to release his own console, there's another one for ya. 

The Wii is simultaneously the best and worst gaming decision made by Nintendo.

It's the best because it will most likely be their most successful home console.

It's the worst 'cos they will never get their hardcore audience back.

1) Atari 5200 SuperSystem, should have waited a few years and made the device much better specced than the 2600.

2) Sega 32X - super ugly Genesis add-on, especially in combination with the MegaCD add-on. They should just have made a sleek all-in-one new console.

3) XBox 360 - Nomatter how much resources the behemoth Microsoft has, their incompetence shines through with regard to this console. Sure ATi designed a good GPU for its time and there's nothing wrong with IBM's Xenon processor, but it's all put together very badly resulting in the least sturdy and most sensitive (especially bad for kids) console in modern history.

Best choices this generation:

1) Default Wii-mote controller by Nintendo in combination with easy entry cute games. Attracts many new gamers, especially many females. Best toy-like console suitable for younger kids.

2) Cell Processor. Huge performance gains for games and multi-media uses which will increasingly manifest itself in future games, will push developers towards rethinking their inefficient gaming engines which results in better performing PC/360 games as well. Paves the way for future Cell based or Cell-like architecture consoles and devices, good bye sub-linear performance gains, hello exponential processing gains.

3) Blu-Ray drive and default harddrive. Top impressive games are becoming storage wise far more demanding, HDTVs are becoming standard. For the years ahead of us especially the extra storage space will be of crucial benefit in addition to mandatory scratch resistance and constant predictable streaming speeds for developers to optimise for. In addition Blu-Ray (/harddrive) also makes the PS3 more than just the most future proof games console, it's the best value for money future proof Blu-Ray movie player and thus the best HDTV targeted multi-media device.

Konami releasing a half finished Pro Evolution Soccer 2008 was pretty dumb actually come to think about it

 lol, read three posts above yours :p

Oops.

Well, I was right about Trip Hawkins.

And strange that it took so many posts to note the Nintendo fail. If they had gone along with Sony then, Ninti fanboys would have their own army by now.

5-Rare being sold to MS (was and still am pissed about that)
4-GBA (a year later and we had a GBA SP... WITH light, the horror)
3-GBA Micro (worst handheld invention if you ask me from Nintendo. The bloody thing doesn't even play GB/GBC games)
2-Playstation 3 worldwide launche price, literally killed sales
1-RRoD (never experienced it, but the messages all over the Internet plus news makes this simple the biggest mistake all time, as it kept on continueing with the latest sku's and that's simply ridiculous)

What the heck is wrong calling the WII the worst console? That's not trolling that's having an opinion.