Is Nintendo Making A Big Mistake Ignoring Smartphones?

A 2006 Nintendo DS Lite, already beginning to ...Image via WikipediaSatoru Iwata made clear at the Tokyo Game Show, that Nintendo will not produce games for smartphones.
Asked about rumors of possible Nintendo games on those platforms, he said:
“This is absolutely not under consideration. If we did this, Nintendo would cease to be Nintendo. Having a hardware development team in-house is a major strength. It’s the duty of management to make use of those strengths. It’s probably the correct decision in the sense that the moment we started to release games on smartphones we’d make profits. However, I believe my responsibility is not to short term profits, but to Nintendo’s mid and long term competitive strength.”
This is a big no. And the questions remains if this is the right decision.
Smartphone gaming are growing insanely. With Android coming in the game, developers have all possibilities on their side. And the games getting awesome. There are quite some games in the market that have better graphics than any DS-game and a lot of innovation on top. The Niche for handheld-gaming is getting smaller every day for dedicated devices. I can see this on my own behavior. I'm having a DS, Wii and a lot of Nintendo games. I love the brand, the characters, and the games. But having a 7" tablet, an Android phone and only a limited amount of time, I see myself not even touching the DS for many month now. I have my phone with me, I can have the same game on my tablet with a big screen at home, and the games are generally much cheaper. I'm still playing with the big console at the TV-Set. But for mobile gaming, I don't see how Nintendo could lure people back to a dedicated gaming device.
I think they not only miss a new market, adults who casually play while on the go, but they will also lose a part of the present customers. Just because such an device is already around. It's so tempting to just click "Buy" and having a game for 20+ hours fun for a few bucks. Maybe Nintendo is missing the future of gaming. That would be ironic. Nintendo made the future of gaming for decades.