No question prices of games for smartphones are much much lower than for dedicated game consoles, yet the market is so much larger, so lower prices can still mean higher revenues.
Nintendo chief slams iPhone, Android for devaluing games – Electronista
This will (my prediction) kill the market for dedicated mobile gaming devices over time, like mobile phones killed the watch and PDA markets.
I’m not talking smartphone/game console combinations like the Sony Ericsson Xperia Play, that will have very little impact, but normal everyday smartphones that soon the majority of users will have.