People always use that as an argument, but they don't realize it's NOT free advertisement. To begin with, they've already spent millions of dollars on whatever game the LPer is playing through. Secondly, The money that would come from people watching that stuff online could be going to them, but instead it's going to some random people who are in no way associated with the company. In addition, although this method of watching LPs might rake in a few customers, that number is totally negligible from the official sites that do the same thing with trailers and gameplay videos, such as IGN or whatever else. This is a poor argument to use to justify LPers making money off of their run throughs, but I see it EVERYWHERE.
It's because of the fact that LPers are broadcasting (the majority of) the contents of their product to the world. Again, going to the movie example, you do that, you're basically giving the movie out. A game is an interactive experience, yes, but the graphics, music (story) and gameplay shown make up most of the game. When you broadcast that, you've giving out their entire product for free basically.
Well, remember that this doesn't only apply to LPing. It's any videos with extensive content from Nintendo's games. LPs are just one category.
So let's say I make a review of Wind Waker. It's a 15 minute long review, and I spend weeks collecting footage, arranging it, putting in effects, etc. I spend a lot of money getting the best recording equipment and editing software. I script the review and do my best to make it as professional as possible. Let's say I spend around 100 hours playing, scripting, and editing, and I spend $1000 on all the equipment to do this and other similar reviews on other Nintendo games.
In the review, I sing Wind Waker's praises, heavily saying that people should buy the HD remake when it comes out. I do this because I love the game, and all I want to do is share something I love with people around the world and get other to be able to share the experience. However, because of all the time and money spent on it, I'd at least like a little money back for my efforts.
Under Nintendo's new policy, my video's advertisements would go to Nintendo. However, I obviously didn't make enough content to prevent people from buying WW. In fact, I did the opposite by pushing the game as heavily as possible. Is it that unreasonable to want to make at least a bit of my money back?
But regardless, I'm not saying that I believe that LPers deserve a bunch of money. Honestly, I don't really for the most part. All I'm saying is that this is what other people see, and it's pissing them off. I don't care what you say and what arguments you give. This is how they feel, and they are threatening to boycott. So no matter what ethics you point to, this is Nintendo pissing people off to make money. And I'm just saying that wasn't smart of them to do, even if they are in the right to do so. I don't know how much plainer I can say that, but this seems to be continuously lost on you.