>>43818823He's saying that the majority of merchandise is based on content from the games, so he's calling into question why TPCI doesn't fund better games since those are the core of the franchise, despite only accounting for 17% of it's total revenue.
Of course, it's the same reason they currently aren't. Even subpar games with cheap budgets will still sell and TPCI can make merch on whatever major content is in the game regardless, and if none of that sells, they have a thousand other backlogged characters to use. How many products are just Pikachu's face smacked onto something for a 30% price hike? At this point, it's as if the games are only there specifically to make new merch of and with constant game announcements the entire Pokemon brand is constantly in the spotlight.
From a business perspective, it's one plausible strategy, as long as the games don't get so bad that people just stopped caring at all or they burn all good-will even with hardcore fans, but it's incredibly anti-consumer and depending on their other decisions, especially with the current spot they're in, it may bite them in the ass in the long run.
They don't care for now though, all they want is max profits and limited expense in the moment, anything else be damned.