It depends on what you mean by "die off." Nintendo isn't any different from any other company. People tend to forget there was a time when Mario and Zelda and Smash Bros. weren't enough to push more than about 20 million consoles. I don't think they'll fail in the sense that they'll go third party, or that they'll suffer multiple years of loss, but they're in a vulnerable position now, and it doesn't take many mistakes before another competitor swoops in take your spot at the top. Nintendo will still, ultimately, make money and recover from where they're at right now, but it wouldn't happen in a major way unless they make some changes. Right now, there's little indication that's happening with their current devices. It's an exaggeration to say Nintendo is screwed, but it's an underestimation of what's happened to say it's "eh, whatever -- PRICE DROP" and everything gets better.
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Simplicity is the ultimate sophistication.