it's an interesting article, but currently optimistic imo, because we still need to know more about what nintendo has planned for the console. outside japan, wii certainly has the potential to do well, but i think it depends on how slow ps3 and 360 ('s continued) adoption rate is, as much as how desirable wii becomes.
if western third parties are truly caught off guard, well, they may have lost sight of what certain consumers want as much as japanese devs. it's certainly true most non japanese developers have had no real success with ds partly because they haven't bothered with the platform in an effective way. once again it's nintendo leading their platforms, but it seems more significant now.
in japan, to be honest i'm surprised how many people still see ds's success as relatively normal, it's not. ds has revived a dying market with nintendo software and is selling 150k a week, during summer with no major releases! sure there have been successful consoles over the years, but this kind of domination is staggering...
the success of ds in japan has become far more than a nintendo fan circle jerk and the whole situation over there is becoming critical for third parties. to put it bluntly, they've no idea what's going on and they have no apparent solution. while there are a few major franchises still selling well, the majority of japanese developers have lost sight of what many consumers want, and if they're not careful, they will be in major trouble.
initially i thought the rock and hard place third parties could be caught between would be ps3 (slow adoption rate because of price, declining audience, expensive development) and wii (competing with nintendo software and trying to sell to market they don't understand) but it's become so bad, many japanese devs could end up being between a declining interest and increased competition outside japan and an inability to sell games domestically!
admittedly there was a rough patch during the 1st half of the gamecube, but now i'm loving what nintendo has been delivering and i'm happy playing the best nintendo has to offer, but, i don't want to see any third parties disappear, they're needed. the bottom line is competition creates better games for everyone. japanese developers desperately need to find a way of expanding their audience domestically.
if wii becomes successful everywhere, the industry will become very challenging for most third parties, especially if they try and pull the usual 'oh, our games don't sell on nintendo consoles so we'll just pay some lip service and give the usual shovelware and delayed ports'.