Eventually broadband speeds will be so fast and processors will be so powerful that all you will need is a monitor, a connection and a way to interact (a controller/remote).
You Monitor/TV will decode everything on the fly and you won't have to store anything on your side as it will all be streamed to you digitally, this includes TV, Movies and games. initially this will require some sort of set top box (what MS & Sony are fighting for at the moment while Apple tried a different approach with AppleTV), but eventually your display will handle everything for you.
If Nintendo doesn't adapt with the times and allow tech and it's function to evolve, the more convenient option may eventually win out, but Nintendo can be that convenient option if they allow themselves to be. You can only delay the inevitable for so long before you are just left behind wondering what just happened.