People associate PSP as a failure all the time, it's just amazing. The thing is, it brings in more mony to Sony than the PS3 does. It has sold over 50 million.
Well, people associate the PS3 as a failure too, so being a somehow smaller failure is not a good excuse.
And it is a failure for the same reason: lower than expectation results. Both of them were expected to be clear market leaders, and they aren't.