They were locked down very hard with the NDS at the policy level. They didn't lose on content but they did have a lot of problems with piracy. So for Nintendo,

They were locked down very hard with the NDS at the policy level. They didn't lose on content but they did have a lot of problems with piracy. So for Nintendo, experience doesn't suggest they will lose out by being such a closed system. If anything, they might have drawn the conclusion that they have to lock it down harder. They certainly took that tack with the hardware and code, but I don't know about their current developer policies. I don't think they'll actually become the loser because of it, but I do think they could get a lot more engagement if they opened things up considerably. I'm not sure what kind of difference that would make, they make a killing on licensing and they probably don't want to risk endangering those profits while they're in the top spot (~45 million 3DS units shipped¹, ~4 million PS Vita².) ¹ https://en.wikipedia.org/wiki/Nintendo_3DS https://en.wikipedia.org/wiki/Nintendo_3DS (sidebar) ² https://en.wikipedia.org/wiki/PlayStation_Vita https://en.wikipedia.org/wiki/PlayStation_Vita (sidebar)