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Yeah the Blue Ocean strategy worked well for the Wii till 2009/2010 but Nintendo still mixed in enough of their regular games with their casual offerings. Its the major third parties that either showed very little support to begin with (ex. Rockstar) or completely misread the market (ex. EA, THQ) which is why their output suffered in the long run. Even Capcom and Take Two were hit-or-miss when it came to support.
Activision and Ubisoft were probably the only big 3rd party studios that kept a decent balance so they got the best of both markets (casuals & hardcore). Even then, both showed way more constant effort when it came to the Xbox 360 and PS3 besides tech reasons.
PS2 and PS1 libraries were just as bloated with shovelware like the Wii but Sony never had to deal with the same issues Nintendo had when it came to major 3rd party support even during the early PS3 years when things were really dire for them.
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