Yep, unfortunately. I do like Iwata, and I'm indifferent on Reggie, but Nintendo as a whole have had 3 generations in a row now to recognize that the conservative bullshit isn't going to cut it with consoles.
Time to fire them and bring in someone who is willing to go where the market is going. Loss leading hardware, vast online infrastructure, media services, strong third party outreach, and making your money back over the longhaul with sales of services and software from first and third party.
This ain't the 2006 anymore.