Mobile gaming is a scary. It used to be the backwards, ignored cousin of console and pc gaming, but it's very much taken on a life of its own. In the days of yore we had a few systems that were cool ideas, and some even looked amazing, but the technology was terrible. Systems like the Sega Gamegear used six AA batteries and had a total charge time of 3 hours, maybe. It wasn't great. Even the great Gameboy in its early days had some issues (it was huge and difficult to see in sunlight) but now mobile gaming is insane; a system no one expected.I don't want to recount the whole story, but I will say that Nintendo got it right for a long time. A long, long time. I mean, they occasionally got it wrong, the Virtual Boy being probably one of the worst gaming systems ever (and the 3DS reaffirms part of the reason), but everyone ignored those things for the most part. The Gameboy and NDS were hot commodities that printed money year over year. The best part was they had good games, great games even, such as every Pokémon game, the Layton and Ace Attorney series and various Zelda titles. The scene has, however, most defiantly changed hands.
Cell phones have had games on them almost as long as they've existed. Early bar phones had Gameboy-like screens (green and black) and played exciting games like Snake and Tetris. Eventually these games evolved bit by bit, moreso in Japan than anywhere else, but eventually simple cell phone games gained a lot of depth. They were still difficult to play, ugly and mostly cash grabs, but they were going somewhere. The birth of the 'gaming phone' didn't take too long, but failed. The Ngage by Nokia is the best example, but there were others. They were awkward to use and had no support. Besides that they were expensive. There hasn't ever been much room for a gaming phone, and mobile gaming has almost always been aimed at children. No parent really wanted to by their child a nice cell phone that could cost hundreds of dollars and pay for their expensive cell phone plan.
The PSP and NDS showed that we could have very deep, good looking and fun games on mobile platforms. The PSP also showed us that they could be very cool multimedia devices with a surprising amount of functionality. However, the PSP and NDS sort of represent the end of the old era. The 3DS has shown that not many people are interested in a dedicated mobile platform anymore, and very few care about 3D effects in games (I am one of those few, but I can't blame anyone for not caring). The 3DS has more issues than that, but that's a different discussion.
The NDS had introduced touch screen games into the mainstream, also the use of multiple peripherals at the same time. It had a microphone, two screens and buttons. A few years later, the iPhone mainstreamed the slate, touchscreen smartphone. The iPhone itself was a very neat device with a bunch of cool features, but mostly a proof of concept. It wasn't the first slate touchscreen smartphone, but for the time it was the best and most advanced. At this point many people weren't interested in the iPhone at all. The iTunes market hadn't been established yet and, from what I can remember, it certainly had no games on it. It was essentially a nice phone with a good web browser and a GPS, and not much else.
A few years later, after the market had been established and the release of the iPhone 3G, just about everyone was making apps for iOS. More importantly, they were making games. Shitty games, but games nonetheless. Many game studios started making their own iOS games. Konami made an MGS4 game and sold it for $10 or something like that. As time went one, and Android and WebOS were established, a certain price point was established.
Now, I'll mention here that many DS and PSP games were upward of $30, and sometimes more. 3DS games are even more expensive than that. PSV games are assumed to have a similar price point. Shitty iPhone games are, at most, $0.99. However, to compete with this, even good games like Angry Birds and Cut the Rope don't get above $5. Even Infinity Blade, a game which looks better than any PSP, NDS or 3DS game I've ever seen, premiered at the high, high price of $6.
Mobile gaming is no longer what it used to be, but players like Nintendo and Sony are still trying. The market for a focused mobile gaming platform is dying off and fewer and fewer people want to pay for $40 mobile games. Sony knows this, they have many of their own high-end Android phones on the market, one made specifically for gaming, but Nintendo doesn't. Nintendo isn't about to make a Nintendo Phone (or, if they do it will undoubtedly fail).
I don't wholly support the direction mobile gaming is going, but I do expect games to always get better. If phone games can get better and better while staying a very low price, then there is nothing to complain about, but Nintendo expects everyone to buy OoT again every few years.