I was just looking over hardware totals and realized the PS3 only has an install base of 20.78million in America. Now compare that with the PS2 at 56.12milion and the PS1 at 40.78million. 

Let's compare it to the Xbox which launched in late 2001 and got discontinued in late 2006. So that's about 5 years on the market.  The PS3 launched in late 2006 and it is now 2011 so that's about 5 years and counting.

Xbox - 16.34 million
PS3 - 20.78 million

Aren't these numbers dissapointing? The PS3 install base in America is barely ahead of the original Xbox which was considered a flop. 
Of course the PS3 still has years left so it'll sell another 5-10 million lifetime. But in the same time period of 5 years the PS3 barely outsold the original Xbox. 
Where did Sony go wrong? Is the Xbox 360 too much to handle? What can be done to change things next generation?

(Fun fact: if you combine the PS3 and Xbox 360 sales in America you get 53.97 million which is slightly less than the PS2 at 56.12)

No

I'm talking about sales. So why do you think its not a failure?

It has sold more than the Xbox and the Xbox was not a sales failure.

And threads like these are why I have stopped following sales.

ohh here we go... ps3 took a shot and it kinda backfired on them this gen sony could have released a ps3 with the same capabilities as the xbox and no blu ray and ps3 would have sold 170million but they didn't because they were not looking to smash the competition this gen they are working on a longer goal... the ps3 is just a BETA in there console plans the ps4 will be the real deal.. and the best thing for them is they have japan.. and usa isn't japan so the ps4 could easily kill the 720 in amercia if they play there cards right and they have europe on there side atm they have the advantage for the next gen
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my opinion though

It's not a failure. I'd say it did pretty good but Microsoft stole a lot of their market share here in the states. As long as Microsoft is in the race i doubt we'll see the PS brand as successful as the PS1 and PS2 days in America.

of course it is compared to its predecessors but as a console in its own right no i wouldn't say that

Compared to it's predecessors it is kind of a failure. But all things considered it is not a failure in the least.

Yes, its going to be the hipster system next gen that every hipster loves but no one bought (Ala Gamecube and Dreamcast)

how can you consider 50m units of anything a flop?