Nintendo really messed up with the Wii U. The name sounds like it's just an addition to the Wii, the marketing is all wrong and the device is all wrong.
Nintendo ran out of gimmicks on the Wii, they threw everything at it. UbiSoft actually had a tablet called something like Wii Draw.
Tablets are all the rage today, but you can buy any tablet you want and it will work with the Xbox One and PS4 out of the box. So, that just kills any features that Nintendo has.
Microsoft even has a dedicated WiFi Radio and chipset for WiFi Direct that will work with every Laptop/Tablet/Smartphone and of course a next generation Kinect 2.0 that does everything that Nintendo has and more.
Here is what I would do if I ran Nintendo...
0) Communicate directly with the fans and let them know of some of the changes. Communication is key here. Work together with them as they will be buying the products.
We would be doing an E3 Keynote and on the show floor, we would do Nintendo Directs, we would do blogs and chats. If we would be using social networks and we would be not hiding anything.
Hiding doesn't do anything other than just make you look bad, we have seen this with Microsoft.
1) Do not make anymore Wii U consoles. Let inventory deplete as much as possible. (Keep a watch of the inventory cycle, be aware of cutting that down as per industry standards)
2) Sell that remaining inventory at a realistic but small loss (Focus on cutting costs as much as possible, also examine overhead as well. Watch this monthly).
3) Release the software and see if it generates anything.
4) If the "Killer Software" titles do nothing and the price drop does nothing then follow through with dropping the system over a period of time
5) If Number 4 fails, then contact Microsoft across the street of the NOA HQ and obtain devkits for XB1 (higher quality software here is the goal and to rest some IP and bring new IP into the picture)
6) Work a deal with Microsoft to lower or exclude license agreements (money for producing software on the MS system)
7) Start planning software titles for the XB1 (obtain tools such as development tools and an engine that can be unified at Nintendo's )
8) Focus on the 3DS full steam ahead and reducing the price of the system to get it close as possible to the 99 price point over time. Focus on cutting costs and watch inventory.
9) Meet the Occulus Rift guys. I want to see what it would take to get them on board at Nintendo. I want to focus on a modified version of this for Nintendo. I want to also focus on putting a camera on the front so people can see without taking off the product. Games, Games, Games for this product and then reuse the Wii U graphics for this. Reuse when possible. Make sure we can be profitable with this. Examine costs and profit margin here.
10) If 9 is good and we should at this point be making profit on the 3DS as well as Xbox One Titles, hire more Western support. The goal here is to not lean too much on previous IP's. We can have a Mario or Zelda, but lets not try to milk the IP to death, lets add in a little variety and also quality of graphics and game play. Nothing stale and has to be original. Nintendo isn't going to make an FPS, that just isn't Nintendo.
11) Advertising and Marketing the "New Nintendo". This is **** HUGE ****. The marketing for the "Occulus Rift" product can be a buy in addition to that of the consoles you already own. The 3DS, a powerful nugget of goodness that is priced cheap to tempt people into buying it because of the great games and low price. When you get to the 99 dollar price point that is almost irresistible.
I have always liked Pixar as far as graphics, lighting, and animation. I know you can't get there exactly, but that is the kind of graphics that I would shoot for if I was ahead of Nintendo, 1080p of goodness using the latest graphics technologies and getting some of that magic back on game play as well. Having new IP's and lessoning the older IP's only when we can do something new and original.