They certainly wont fail (already repeating the success of the Wii with all units being completely sold out months before release). But if they did, they would just get again later I'm sure. I doubt they would ever outsource their software, and they don't seem to want to just produce mobile games, so they would likely just try to make a better console next time.
It doesn't matter if fails. Nintendo is ungodly rich.
Besides, they've been around over 130 years. If they drop out of the console market, it won't be the death of the company.
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