I've still yet to play a smartphone game half as deep as any of the games I played on the original Game Boy as a kid. Modern smartphone games are really not that far removed from Snake on the early Nokia phones: Simple time wasters you play for a few minutes during lunch break or while waiting for a friend, distractions to fill the little gaps in life, only now, they all have slot machines taped onto their sides. The thing is, Nintendo's portables were never competing in this market in the first place. It's not like the original iPhone came out and regular people everywhere said "oh wow, now I don't have to lug a DS around everywhere!" When did you ever seen someone over the age of 10 waiting on the sidewalk with their face buried in a Game Boy?

The actual "on the go" use for a handheld is for people that are regularly stuck in transportation for long periods of time -- mostly children in the US, but public transportation is more common elsewhere. If you were going to be stuck in a car or other vehicle for hours on a trip, you'd probably want something more involving than Angry Birds to occupy your time. You simply can't offer that kind of gameplay experience with just a touch screen (with the possible exception of menu-driven games like RPGs, which I'm surprised there aren't more of on smartphones... probably because it's harder to make a good RPG than it is to lock a tired old flash game in a Vegas casino for a few hours and drape a nice coat of fur over whatever stumbles out...), and the moment you bolt a more game-friendly input device onto a phone, it stops being a fashion accessory and becomes a "toy" that no adult wants to be seen carrying around in public (I'm not immune to this effect, but it's still ironic since smartphones are mostly glorified toys in the same way that expensive cars are)

The other main use (and the way I've enjoyed Nintendo consoles for years) is for lounging around the house. There's something really nice about curling up in bed or on the couch on a lazy day and getting lost in Animal Crossing or whatever for an hour or so. Or, uh, taking it into the bathroom and spending more time than you expected to...

What I'm getting at is that the main competitor for Nintendo's handhelds is actually the iPad: Something you can pick up at home, hop right into a game/web browser/whatever without tedious load times or a serious commitment, and put away at a moment's notice: just close the lid/hit the lock button and it'll all be waiting for you when you feel like it. Only, they aren't really competitors, because people don't surf the web and watch videos on their handhelds, and they don't sit down with their iPads for hours playing Fire Emblem. Neither has the right form factor or input method for the other use case, so neither can completely replace the other.

Nintendo and to a lesser extent Sony are the only ones that seem to get the appeal of this kind of experience, so I'll keep buying their handhelds 'til they stop making them. As will a lot of other people who grew up with various iterations of the Game Boy. Really, my only complaint is that their platforms aren't more open to indie developers, though I get why they don't want to harm the reputation of their consoles with an app store free-for-all. At least Sony seems to be moving in the right direction on that front.