I know nothing about video games, but it sounds like that's the free market showing that a company which gave so much freedom to third-party developers - in that market at that time - couldn't compete it against the companies that chose another approach. Unless the entire industry collapsed as a result? which I guess it didn't, since it sounds like Nintendo made different decisions and had better results -but even if the entire industry had collapsed, then it just meant that people were choosing other ways to use their time and money.
Are you thinking of how this applies to developers in the Nostr ecosystem?