I am a bit biased, having worked on two Nintendo U64 games (mostly game AI). That said, Nintendo seems to be doing everything right:
- Concentrate on game play: Shigeru Miyamoto (who was at Angel Studios the first morning that I started there - many years ago) felt that the key to better game play was a new controller metaphor, not expensive graphics hardware. Start with a concept (game play/controller vs. graphics hardware) and carry that through from development to launch
- Profitable console! Compare to > $200 loss on selling PS3 console.
- Launch with sufficient units: satisfied Nintendo customers vs. many disappointed Sony customers