Atari founder Nolan Bushnell has said that he believes Nintendo may be facing a "path to irrelevance" with its current products.
Speaking with the BBC as part of the Campus Party developer event being held in the UK, Bushnell said he thinks the time for single-function gaming devices has passed, and that the device marketplace is simplifying.
"I don't think handheld game-only devices make sense anymore," he told the publication. "Not when you have an iPod or an Android microtablet.
"When it comes to the console market, I think the market is truncating," he said. "Nintendo always had a soft spot for young people--they sort of did the 12-and-under pretty well, and the other guys did the 12-and-over.
"And now I think the other [consoles] are good enough on those things, and the rush to upgrade from the 12-and-under is not nearly as important."
Bushnell is more positive about virtual-reality devices like the Oculus Rift, saying that provided the challenges of display latency and the feeling of motion sickness can be resolved, the device has a good chance to succeed.
"The problem with virtual reality has always been motion sickness," Bushnell said. "If they're able to really get the reality and the image right, with low latency, I think they'll get it. With most motion sickness, you can build up immunity--and I believe that will represent a brand new, really powerful gaming system."
Last month, a Nintendo rep confirmed that the company is still selling its Wii U system at a loss. Two weeks ago, the company revealed that it would be phasing out the basic version of its Wii U hardware, as well as slashing the price of its Wii U system from September 20.