But that's exactly the same reason I stopped buying any console. I was more than happy to let the handful of Sony exclusives pass me by, and then they started coming to PC. Now I'm more than happy to let a handful of Nintendo exclusives pass me by.

I agree with you here and I wish more people did it as well, but it's not how it works. Millions of people buy a Nintendo console for their exclusive title of choice, be it Pokémon or Mario or whatever. That's how it's been for the past decades, and judging from the ~~20M~~ 3.5M consoles sold in a few days, that's how it's going for the Switch 2 as well.

Those people had plenty of alternatives, be it a traditional console (PS/Xbox), a PC, or a handheld (Steam Deck). They went and bought a Nintendo on day one, despite the alternatives offering equal or better performance, similar form factor and in the same price range.

But that's not driving console sales like they used to. The last few Final Fantasy games seemed to do quite well on PC, indicating that people did not buy a PS5 to play them, and PS5 is having difficulty matching PS4 units sold even with the utter decimation of their closest competitor.

Yes, but again, that has nothing to do with the argument at hand. Third parties don't have a horse in the race, they are content selling as many copies as they can because that's their only revenue stream. It's a completely different situation for console manufacturers, to the point that they are not even remotely comparable.

That's another point you made later in your post; wherever Xbox players went, it wasn't to PlayStation. Data would seem to indicate that not even all of the PlayStation players stuck with PlayStation.

Exactly, which shows that players do move to whatever platform is more enticing to them. There is certainly a "core" fanbase that sticks to their console - either because they have invested in a digital library, or want to stick go their profile and the achievements/trophies built over the years, or simply because of blind brand loyalty - but there are also lots of people who jump ship and take their money elsewhere. And judging from the numbers, it's not a small amount.

Exactly, but potentially, they would stand to make way more money by selling more copies of those games than by selling more Switch 2s and getting those customers locked in.

That was never the question. Of course they would sell more copies of those games by porting them elsewhere. The question is, does that risk them losing more money in the long run, as players buy their games elsewhere?

A Nintendo player gives nintendo 100% of the cut in any Zelda sale (and other first party titles), and a 30% cut on any other third party game bought on their platform. Conversely, a PlayStation player will give Microsoft 70% of the revenue for one single sale (Forza Horizon 5) and 0% on anything else.

If your user base is small (the Xbox user base certainly is) and not accustomed to buying games (which many devs have lamented over the years - I remember this article from 2022, for example), then it's a no brainer: port your game to the rival console and enjoy that 70% cut. It's not as cut-and-dry for Nintendo.

Yes, there is. If you got 30% of all sales from games on an install base the size of the Wii U, it's not going to make up for a game like Mario Kart or Super Smash Bros. selling 100M additional copies on extra platforms. We don't know yet how well Switch 2 will do (probably better than Wii U and not as well as the Switch 1), but at certain thresholds, that 30% leaves them worse off than that other 70 that reduces the value of their platform.

If your/Piscatella's argument is that they should give up a 30% cut on all sales because of the possibility (insofar, with no backing) of their console selling less units than the predecessor, then it's a bad argument.

Even if they somehow lost 10/20% of their previous user base, that's still gigantic enough to make their 30% cut (and all adjacent revenue streams, like online subscriptions, hardware sales, etc) enticing, especially if those people are accustomed to buying games at full/near full price. Suggesting that the alternative - taking a 70% cut on a few select titles - would be better for them sounds, frankly speaking, ridiculous to me. I would be willing to hear that argument a few years down the line, after seeing how Switch 2 is really doing, but for now, there is simply no reason at all to even entertain such an absurd notion.