Really, their one and only major mistake was pushing blu-ray with the PS3. The $600 PS3 was stupid, and it was a format no one really wanted. Movies were moving to online distribution and people did not want to replace their massive DVD collections with something marginally better. It was too soon and a very bad decision.
The Vita project is a big failure for similar reasons as the PS3 (price, unwanted tech) but it may have been OK if the Playstation brand hadn't been so badly damaged by PS3.
XBox360 launching early hurt them too, but that wasn't a Sony decision and there isn't much they could have done. 360 released earlier than it should have.
For me I think the $600 BluRay PS3 is the one massive bad decision that has hurt Sony possibly beyond repair.
