The Wii U itself is certainly looking that way of becoming a failure, but if and only if you're looking at it from a particular point of view. If you look at the Wii U in terms of sales, yes, it is a failure right now. But it's interesting what this potential failure has managed to launch with Mario 3D World, Pikmin 3, W101, Bayo2, Smash Bros, Wind Waker HD, DKC: TF, MK8, Kirby, etc. For a possible failure, it sure has released some fantastic games, and we haven't even gotten into XCX, Zelda, Splatoon, Devil's Third, Mario Maker, Yoshi, etc. Granted, unreleased games are not representative of great products, because we haven't played them yet. Imagine what Nintendo could do if the Wii U were the success of the PS4 right now?
Does Nintendo need a good kick in the pants? Absolutely. Their decisions over the last few years have called into question many from us who are die-hard Nintendo fans to boot. Nintendo's stance, or lack thereof on Online and taking it seriously, the Virtual Console, consistent flow of games, lack of AAA 3rd party support, etc.
I get what you're saying though about making these decisions right now versus a few years ago, but I also doubt Nintendo had no knowledge of it. They probably thought, "Let's wait and see what the market says, and then we'll act upon it." That's not to say Nintendo doesn't take gambles though. The Wii and DS are clear examples of that. The Wii U and 3DS are also gambles from Nintendo, and one of them hasn't been the success they would want it to be. But Nintendo also did that to themselves by putting the Wii and DS onto such high pedestals in the first place. They used the name brands of the Wii and DS, to help drive their consumer base with the 3DS and Wii U, and guess what? It didn't work. The 3DS was too expensive, and did not have a great lineup of games until a year later, on top of a massive price cut. The Wii U had a decent launch, but the price turned off folks, and the infamous drought in 2013 did not help either, and then AAA companies cancelling support was bad too.
There was also the name, and Nintendo's lack of ability to correctly educate the masses that the Wii U was not an add-on to the original Wii, and was instead an all new console. Although I do have to give the masses some flack because you can find out what the system is with a simple Google search. It's not that hard to figure out what it is. "Hmm, Wii U? What's that? *google search* Oh I get it now."
Does Iwata need to go as CEO? Yes and no. Yes because Nintendo had three years of losses under him. When the PS3 wasn't a big success, they hired a new CEO to turn things around, and it has helped them ever since then. The PS4 is proof of that (although, where are the exclusives?) But No for Iwata because they do have a plan in store, and I'm interested to see what this plan of action they is. Embracing mobile gaming, working on a new platform, keeping steady with the success of the 3DS, and still supporting the Wii U even when its success isn't anywhere near what the PS4 is.
Under Iwata, the DS, DSi, Wii, and 3DS have become successes, whereas the Wii U hasn't been the success of the others. I discount the GCN and GBA because those came out while Yamauchi was still with Nintendo. Both the 3DS and Wii U though have cost Nintendo billions in their cash reserves, although a lot of that money has also come from other R&D projects, on top of a new headquarters, the QOL platform, and other misc things we probably don't know about. There's been a lot of restructuring within their internal staff from merging their handheld and console divisions, to their online infrastructure with the Nintendo Network.
Should have some of those things happened years ago? Probably, but maybe Nintendo figured it wasn't as important back then during the Wii/DS era because of their success. I think Nintendo got cocky, and it wasn't simply Iwata either.
I don't know though. We can debate debate, and debate all day about this. Until I see what Nintendo has in store for us with Mobile gaming, the new memerbship program, and of course the NX, I'm going to play the waiting game to see. We also have the Fiscal year ending soon, so it'll be interesting to compare and contrast the 2013 fiscal year versus 2014. Any improvement for Nintendo is good not only for Nintendo themselves, but Iwata's future as CEO as well.
!
