The lack of funds probably contributed to the Wii only being SD, but it wasn't the only reason. The other reason is Nintendo likes to keep their systems reasonably priced. No Nintendo system ever launched for more than $250 in the US. I doubt the next system will launch for over $250 either.

If Nintendo can make a reasonably priced HD system next generation I'm sure they will, but don't expect to see a $400-600 console from them, as they believe in the E for Everyone philosophy. So they wouldn't want to exclude people because it costs an arm and a leg.

Well, does their next console really have to cost $500.00 to at the very least be in the same stratosphere of their competitors in graphical power?

I think Wii2 will be very powerful and affordable. Many people have commented that we're reaching a point of diminishing returns on graphics. The Wii2 can come out with excellent graphics and still not cost nearly as much as the PS3. I think Nintendo should be the first out the door next gen and sell the Wii2 alongside the Wii (much like with the PS3 and PS2) but unlike the PS3 they should make sure the original Wii software is completely compatible with Wii2.

Making a powerful console is not a matter of resources, even in last generation, they had enough money from the profits of the gamecube and the GameBoy/DS, to design a HD console, and sell it for $400. If they would have sold it for a high enough price, there would have been no need to lose money.

But they decided not to, because it just seemed to be a bad plan. MS and Sony might have the multiplatform titles, but look where it got them.

All of your idea can be reduced to "Wii wins, so Nintendo should imitate the losers next time"

I don't think it comes down to that. I don't think Nintendo's next console has to be as ridiculous as the PS3 is. I would like to see it compare to a degree.

And it's more up to what the other first parties do with their systems. One might even make a less powerful system then the other, and then it's impossible for the Wii to make an equal system to both.

@OP
sigh it's never been about the power. It's about price to expense ratio. Nintendo is sucessful not because it's blowing money from a self influcted wound. It's about creating a product that will still make money but not cost the consumer too much. What you propose is either more cost to the consumer or for Nintendo to influect his own window.

What is the point of, "sigh"? Lose the attitude. I'm not asking that Nintendo sells a $600.00 console.

I think Nintendo and Microsoft may come out around the same time. I do agree with you that we will not be able to tell the difference as well in graphics with future console generations.

i think it is in a way. the hd's consoles power is more of a liability than a asset because most concumers don't care about pretty graphics, and don't want to pay extra just for that.