They've not been entirely ruled out though?
I do understand how they'd be an advantage for the device. But personally I've already got a plethora of capable devices in my household. If I'd wanted to watch videos I'd rather use my LG G5 or iPad due to their better screens. It also makes them preferable for internet browsing etc. I carry my 3DS and phone around with me, whenever it came to a task other than gaming on my commute I'd switch over to my phone naturally because it's a better device for my needs at that point. The switch offering video services wouldn't stop people taking their phones with them on the go.
The switch was always, at least to me, pushed as a device to play gaming. They've never reffered to the device as a classical tablet - either a handheld or console.
If there is a need for them to be there, I hope Nintendo do bring the services to the device. However, as it is, I don't see the reason for this to cause an outcry.
I think it's this opinion that continues to relegate Nintendo to distant last place as far as consoles go.
I'll be honest here, the likelyhood that I'd use Netflix on the Switch is
extremely low. However, that's because I'm going to use it on my PS4 that also has Crunchyroll, Amazon Prime, Hulu, Crackle and it's own Sony media store. It's just easier.
That said, it never had to be that way. For a long time I was running Windows Media Center to my TV, with launchers for Hulu, XBMC and a host of others for all my media needs. The DRM race began, plugins started getting broken for weeks at a time as Hulu and others tried to stay ahead of the people making the plugins, Microsoft abandoned Windows Media Center and now none of it ever worked as well as it did. So XBMC on my TV has all my media and all my streaming media's done through my PS4.
Which brings me to the PS4, which also never had to be that way. Microsoft was well ahead of them in that space and Sony could have looked at Microsoft and said "we'll never match what Microsoft's doing, lets not bother," but they did and because they did I use the console almost every day. More than my PC and infinitely more than my Wii U.
Now to why that matters. First, psychologically, to me, using something every day imbues it with a sense of value. I'm much more likely to stay current on my PS Plus subscription for a device I use all the time versus something I sporadically use. Even if my online gaming was non-existent that month. Second, I know what was released and what was on sale because, well, why not check while before I log off for the night after watching Hulu? I can not tell you the amount of money I've spent buying a game I want that happened to be on sale that I didn't have time to play just because I saw it up there.
I know not everyone's like me. But everyone's also not like you. To me, there's not a chance in hell a Nintendo system could be my primary device. I mean, there is, but Nintendo's shown they have no desire to make a device that'd fill that role. But to someone else maybe these stupid media apps are what would decide whether it gets used every day or once every couple of months when the next Nintendo game is released. And that's huge because that incentivizes that person to stay current on their Nintendo Network payment, it means they have a higher chance to make impulse purchases on the eShop. It'd color their decision to pick up a multiplatform game on their Switch over another platform they may own because they use it often and like the convenience. All of these things impact one another. And the fact Nintendo's basically forfeiting that audience, not trying and failing to meet their expectations but flat out not bothering is telling.
As far as competition goes, you can't be number one by gunning for last. While the chances of them beating Microsoft and Sony in the console space are slim I think anyone will tell you that they have no chance to do so if they don't try, and, even if the goal is lofty the more effort put in should generally lead to greater success even if they don't come out number one. Right now I think Nintendo's mindset is downright toxic to their longevity and they should be called out on this shit.
And lastly, no, doing more doesn't take away from what it does. Nintendo allowing a media app isn't taking someone away from Fire Emblem or some shit.