It needs to be $199 w/ a game to compete for the wallets of people spending 3x-4x that on new consoles this fall, or they might as well stop production by next fall. Even that might not be low enough.
That and/or find some way to make the tablet controller optional in an effort to get the console closer to $99. Provide an optional adapter/accessory that can turn existing compatible tablets into a tablet controller or something (some of the budget $60 tablets from Kmart are more capable whan the Wii Tablet minus a camera). They can't even outsell the Wii right now probably due to price point, and by next fall are probably going to be sitting on the shelf next to $99-150 360s and PS3s with massive bargain-priced libraries one row over to boot.
3-4 years from now I half expect I'll just be able to buy Mario games for my toddler on PS4.

cannot wait.
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