Bit of an overstatement, don't you think? SFV was just underwhelming in sales, not a bomba.
When Dragons Dogma one million sold is considered hugely underperformed, i can't see SFV being other than bomba here. Missing their target sales is surely not going to give SF any help here.
After their handling of the IPs in Smash, I feel fairly confident Nintendo could helm pretty successful turnaround revivals for both Mega Man and Street Fighter. And let's not kid ourselves, even if RE6 was bloated and missed it's insane targets the property is still massively popular. No question losing it would be a blow to PlayStation and Xbox. Then you have Monster Hunter and Ace Attorney which already fit seamlessly with Nintendo's core audience. Capcom also has experience in making scalable cross-platform middleware (MT Framework), which is an area Nintendo is probably looking like they may need some help. With Capcom it's not just the properties or the workforce but also the technical expertise they could bring.
And it's not like Level 5 isn't just as, if not more, notorious for speedy IP milk and churn. Professor Layton and Inazuma Eleven may have been huge at one point but they're essentially dead properties at this point. Yo-Kai Watch is doing great but we'll see if Level 5 can make it last, with two strikes so far I'm not that confident. Monster Hunter's outlasted all of them by comparison and it's even older.
I do agree Level 5 would be an easier company to absorb due to their size, but I'm not sure what Nintendo really gains here. They already secure nearly all their games with western publishing deals, they don't really need Hino and their other creatives, their properties are largely redundant, and their low workforce means they're reliant on contracting developers like Hand, Tose or Tri-ace to make their games for them. Why buy them?
While i agree on Nintendo ability to revive their classic/dormant IP into new and succesful IP, Fire Emblem, Kid Icarus, Luigi Mansion and Donkey Kong shows they had touch for sure.
But consider this. Is it worth to waste tons of resources to revitalize those IP when Nintendo themselves had huge amount of dormant IP which they themselves lack the time and people to make? I don't think it is really a feasible move for Nintendo to make here.
While on Level-5 side i agree that many of their older Ip has also beem damaged due to over milking, they are also a kind of company which is famous for keep getting hits again and again. Their risk taking moves is what Nintendo right now need as they are a bit more on the safe sides when they are producing softwares during this 3ds and wii u period.
In the end, both had pro and cons for me here.
Capcom
Pro
Huge employees pool
More experience on engine development.
Huge legacy IP pool to reach new gamers demographic
Cons
Overly bloated number of employees.
High turn over rate
Many of the older IP reputation had been tarnished.
Level-5
Pro
Small and highly efficient employees number
Highly adaptive with market in coming out with breakout hits.
Currently holding one of the biggest franchise in both anime and gaming industries.
Cons
Being popularly famous on taking risky moves and end up blowing in their face.
Lack of any vision on preserving their IP even though they do seems to be holding their Youkai IP really well this time.
