Its a success when it outsells the 3DS on a weekly basis

If you're talking about the smartphone, then I hope you're kidding.  People don't buy smartphones to play games.  Not even little kids.

-PDF/Ebook reader plus other apps
-free PSONE/PSN game with purchase of memory card
-more PS2 games on Vita
-android apps

I think PSVita is selling way better than it should considering the line-up. However, once October rolls around the VITA will have a ton of games coming out. LBP, Persona, AC, Silent Hill.

Start by reducing the cost of memory to something manageable. Include more memory in bundles. Release those PS3 ports and dumbed down versions of PS3 games (Sorr AC: Liberation), but eventually Sony has to assign their top developers to making original new games or entries in long dormant franchises that can be resurrected sucessfully. Vita exclusive Jak and Daxter anyone? Daxter was the fifth best selling game on the PSP. And for the love of God, don't release Vita games later on the PS3/4 as a part of some HD collection. That would totally kill the legs of the necessary system builders.

Now that I'm thinking about it, try porting more PS2/3 games. Can you put Skyrim on the Vita? That would sell well, even a year or two late, and illustrate how lame the 3DS is in comparison. And even if that doesn't work, try porting PS2 games to fill up niches in your library. Final Fantasy X is a fine start, but once again, you have the PS3 version sabotaging sales.

Dammit, this is hard! It would be easier if Sony actually made handheld games instead of console games for portables.

sell them for 1$ you could sell a hundred million before going bankrupt

I think it's simple, lower the price a little bit and bundle it with a memory card (8 GB would be perfect) and of course have some great library of games, the problem is that in order to do so Sony will have to spent a decent amount of money in buying the exclusivity for some games or making games on their own.

Those commercials are the peak of both sony and video game advertising

Well I'm pretty sure it can't get android, but once PlayStation Mobile launches it won't matter. It's essentially the same thing ala Sony for VIta, Xperia, and HTC.

Straight-up more advertising - I've seen one advert for it since it came out, and that was in a reel of adverts before a film showing at the cinema. This isn't an exagguration

Like I already said, a price cut will not help much without the games. This is no joke, but amazon germany already sold 3G Vitas for as cheap as 107€ (warehouse deals of about ~300 reurned vitas) and new wifi devices with 8gb memory for 189€ and it still didn't help that much.