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Yes games are developed for handhelds (especially in Japan) because its less risk and cheap. The latest AAA titles for consoles are so costly that developers forced to i.e create more of remasters instead. This was actually a complaint about ps4-catalog.
Nintendo should sell the Switch without the dock as "gametablet" for 199€. That might make it a real seller. Might eat away 3ds sales though.
http://www.eggplante.com/2017/01/15/nintendo-could-release-switch-for-199-right-now/
I'm actually fine with it being $299. The original Shield tablet is $299 and that is a bargain (IMO) for the power of that tablet, and while the Switch is not 1080p or 8" like the Shield, it has the Nintendo licenses and will have much larger game dev support (outside of the obvious Android support that the Shield has, but "serious" Android gaming is still not quite there yet).
The key here is that you get a pretty nice portable console + a home console and also a cool controller that can be used in either mode. Also, the portable will use cartridges and have neat features like that. That is a pretty good value, IMO.
Essentially if they get a bunch of the portable developers + some of the console developers as well, they are set. The Shield which the design of the Switch is somewhat based on is/was ahead of its time, and it didn't have the Nintendo brand or exclusives. So if the Switch has essentially "the best of both worlds", being a lot of good portable-style games + typical Nintendo console games, it's going to be a hit, IMO. Smaller development teams could potentially create unique and smaller budget games while larger development teams can do the bigger games, and everything in between. Nowadays I appreciate the smaller RPGs a lot more than your typical AAA titles, so this would be great. I'm still working through NDS RPGs.
Oh, and if they just sold it as a gaming tablet, they would need Android support. If they went this route I would also recommend they offer an 8" version as well, perhaps 1080p like the Shield or even a 10" version. Since you'd have essentially all the Nintendo developed "tablet" games that they'd be making for it + Android support, you'd basically have the Nintendo Shield.