Maybe it's all the Simpsons I've been watching, but I haven't a clue what he's trying to say here.

If I had to guess, I think he could be talking about something like Metal Gear Solid. I may be way off base here having never played a single one of those games but it seems lately, everyone comments about them being 85% cut scenes and 15% gameplay which is mainly quicktime events. In that case, the gamer is passive, there's little challenge and they are expecting the game to entertain them with cutscenes and quicktime events.

It's also been talked about how Japan has moved away from playing difficult and hard games and thus many games have a diminished challenge level. While I think Nintendo has tried to meet that market mind set by giving ways to reduce difficulty such as not having the player control the camera in 3D Mario games, giving you the option to remove perma-deaths in Fire Emblem: Awakening and not making a new F-Zero game, it seems that this may be causing frustration as it hard to advance things by making every new iteration of a franchise easier.

Without seeing the whole article, it's hard to know how this all relates to the context of the interview and the question and answers that would be shown. However, it wouldn't surprise me if more follow-up interviews come from this to get more clarification as to what he means.

wut

They didn't remove perma deaths in Fire Emblem to meet the market mindset, they did it so that people didn't waste an hour or two in a single match only to have someone die and they end up doing it all over again.

I like what Miyamoto is saying, but my expectations for something changing are still low.

I explained why I used that series if you continued to read the paragraph I wrote. If you read it and have any other questions or comments, feel free to mention them and I can address them for you. That's wut.

He's talking about casual gamers, not what he could percieve as easier games because they have a lot of cutscenes. That's why I said wut.

I've heard from Japanese speakers that the word Iwata actually used is not offensive in Japan and this is really just the closest translation.

I interpret it as casual gamers not moving beyond casual games.  Like back when this whole blue ocean thing started I figure Nintendo's goal (I think they even stated this, though I might be mixing it with fan speculation at the time) was that casuals would get in with stuff like Wii Sports and then would graduate to the more complicated Nintendo games like Zelda.  Casual gamers would gradually become core gamers.  But that didn't happen.

Sounds more like Nintendo being a bit of a baby that no one's buying the Wii U.

Indeed. I agree with the overall sentiment Miyamoto's expressing, but unfortunately for him (as someone in the entertainment industry) it IS his job to entertain his audience by providing them what they want to experience. It's not the consumer's job to care what the creators finds altogether industry. It's the creator's job to make the compelling argument that the consumer should be interested. If he doesn't like that, he's been in the wrong career for the last 30+ years.

Missed the casual part. Just focused on the passive gamer part. Thanks for the correction.