I think it's hugely important that the higher ups at Nintendo take an honest look at the company and realize what it is, what it can be, and what it can't be.
In the foreseeable future, Nintendo pretty much has to go it alone with just first-party software. Third parties have given up on Nintendo, and the people still playing Nintendo systems only really want Mario, Zelda, etc. anyway. Throwing money hats at Rockstar, EA, etc. won't change the reality of the situation. That money would be better spent on partnerships, second-party deals that will help fill the calendar with exclusive titles that are more in line with the kinds of games Nintendo fans will buy.
Along those lines, Nintendo isn't able to change its brand perception in the short or even medium term. For better or worse, people have strong, long-standing opinions about the company. Nintendo can't suddenly be "cool" like PlayStation or Xbox, or be known for first-person shooters and sports games after mostly skipping them for more than a decade.
And Nintendo can't compete for casuals at all. Those players are perfectly served with free or almost-free time-wasters on phones, tablets, social media, etc. Maybe the secret QOL thingamajig will be awesome, but Nintendo is done selling game consoles on the back of software like Wii Fit and Brain Training. Core gamers are all they've got a shot at getting.
So, what does Nintendo have left? Almost certainly not enough to "beat" the other guys by selling more systems, but enough, I'd wager, to build a profitable and lasting business. Nintendo is an unparalleled software publisher. They own many of the most valuable, time-tested franchises in gaming, and their titles are generally among the best selling and highest rated. They don't need to dominate Sony and Microsoft, they just need to do what they do well, maximize every opportunity, and cultivate deep, lasting relationships with its customers.
I look at Nintendo like Pixar. Nobody complains that Pixar only makes cute, colorful movies. Nobody says Pixar should also produce war films. Pixar does one thing, but does it better than anybody else. If Nintendo embraced its image and put a positive spin on it (instead of talking big about any year-old third-party port they can beg off of someone), maybe the brand's limited focus on top-quality family content can be seen as a positive instead of a failure.
And Nintendo has to keep innovating, to keep trying to surprise and delight players. Also, I like Iwata's talk about rethinking the business of how games are sold; the structure and pricing. That's the kind of back-to-the-drawling-board brainstorming the industry needs right now. Hopefully they'll also take that next big, essential step into offering universal user accounts.
Last thing: Every console manufacturer needs to drive home the difference between a $60 console game and freemium bullshit. People need to know in their bones that when they settle for free or cheap phone games, they get what they pay for.
