Here's the fun part about percentages: when you have a small number, it becomes really easy to increase by a large percentage. A 150% increase becomes less impressive when you're improving on a sub-8k figure, for example.

And then said minor bumps proved to be just that: minor bumps on the road to sub-10k.

Lies, damn lies, and statistics.

I have said this before and will probably say it again: if the price remained the same but say Mario 3dLand came out at launch, what you would have seen (most likely) was the same buy rate of the console but a better attach rate for the games as well as a million selling game much sooner than we got one (kind of like Smash Bros. on Gamecube where sales were not very high but the games attach rate was amazingly high). It would not necessarily mean better sales, in my opinion, it would not have impacted as much as... say... the console was to launch at $199 USD.

However, if my main point is one you agree with, I can agree to disagree with you on the rest as it is purely speculation what would have happened. Besides, I do agree a lack of games was a big deal... I believe more that the price was a bigger deal in this case. This hand held (as well as Vita currently) was priced just above the mass market limit.

So then why did Sony feel compelled to give the Vita such phone-like control features? Why are they making such a big deal out of Playstation Mobile/Suite having Android support? Why, when the PSP sold at the same damn launch price and equally stupid memory prices, had it sold so much more at this point when it didn't come out in Europe until the fall? 

The market has changed. Back in '04, the notion that phones would be able to offer a gaming experience on par with the PSP or DS was laughable at best. Now, casual players have plenty of gaming options on devices they already have, and the Vita is using similar hardware--hardware that will be outmoded compared to other handheld devices within a year or two. Thus, without any bonafied system sellers like Monster Hunter or Pokemon, the Vita would've been a much harder sell than it's predecessor at ANY price.

Yes, price has been the main killer for the PS Vita. But it's hurting it more than the PSP because it's competing with FAR more than Nintendo this time. The notion that the rest of the mobile market isn't having an impact is ridiculous.

I guess I'm the only person who thinks Sony should have launched the system at $299/£269 with each system containing 16GB flash memory. They should have kept propriety cards but exclusively sold the 32GB cards for $70/£50.

Obviously the above price of the system isn't a Mass Market price but that shouldn't matter at launch if you manage to secure your core market. Here is where the Vita failed, I'm not a phychologist but heres my theory and its based on how I initially reacted, as I was planning to get one at launch but didn't. Before E3 2011 people were speculating $349-400, and $300 was considered a price we'd be lucky to get and one which Sony should aim for.
once everyone found out the price was £250, everyone was like "OMG thats such a bargain, its the same price as the 3DS!" (prior pricer cut).

Then people found out they had to spend an extra $60 (current price of 16GB card) to realise the systems full potential and suddenly it was like their candy had been taken away. Not only that but the way you perceived price varies according to the product in question and paying over $50 for a mere 16GB memory card and $100 for 32GB creates the perception of "Holy shit, thats extortion, theres no way I'm paying that much for a memory card!". However had that memory been bundled with every system and partially included in the price (flash memory is cheap!) then it would have been easier to digest because you were spending $300 for complete experience, the best Handheld experience ever!

Games have obviously been a factor too but the Vita launch months were better then most in my opinion (especially the 3DS's). The mistake they made was not securing games for the japanese Market, as it is the japanese developers who will put their A team onto handheld titles, as opposed to outsourcing them to Niilstic games or ignoring handhelds completely as many western devs have. Its also the japanese titles which have a history of selling on handheld consoles in the west. Final Fantasy Type 0 should have been a Vita launch title in japan and released over here in the systems launch window, That one title would have created created a snowball effect and I don't believe the Vita would be in the position it is today. Sony has missed another opportunity to get a killer PSP title onto the Vita in the form of the upcoming One Piece: Romance dawn, the last title in the franchise sold 600k in one week for those unfamiliar with its popularity. The game arrives in fall but if there was any chance of it coming to Vita on time, it would have been announced by now.

However I think the system has potential to be a long term success and I think it will. Lets see how well Soul Sacrifice and PSO2 help the system early 2013 in Japan.

The market is different, but mainly for Nintendo (they can't sell their handheld systems to non-gamers anymore-brain training) and they've already overcome that problem. Generally speaking the market is bit smaller, no one will buy a handheld system for light entertainment when their phone can easily fufil that function, this leaves a market of only dedicated gamers and children. The reason why Vita has phone like features is because they are not "phone-like" they are modern features, all technology is moving in that direction including your home consoles. When you buy a device, you expect it to be utilise the internet, social networking and be diverse in software (both cheap and expensive)

I was mainly talking about the touch functionality, though. Something like Playstation Suite wouldn't be worth much without that--why would people bother making a Vita compatible version when so many more people have Galaxy phones otherwise? Clearly, that functionality was added with the smartphone and tablet market in mind.

But yeah, the narrowing of the potential customer base was my main point. I absolutely agree that kids and core gamers will have to be the main focus, and Nintendo's offerings give it a huge advantage with the former group. Thus the Vita needed to hit the ground running,  with a strong slate of hardcore games across a broad range of genres, in order to justify the purchase. It hasn't worked out that way, though.

I hope they port Gravity Rush to the PS3. It's playable with only the analogs.

1) Because they wanted to. You have no way of proving to me Sony did these things because phones are a threat or matter at all. Even if they said such, that would still not be proof enough. But, maybe they like the features. That is like saying, "Why did Nintendo add a touch screen? Was it because they felt threatened by PDA's back in '04?" when nobody would be able to prove that was the case. You have no legs to stand on, only speculation at best.

2) I was unaware the PSP sold at $300 USD... totally unaware of this.

3) Sure the market has changed. But Nintendo has already disproved the position that mobile games are cutting into the hand held market. It simply is not happeneing yet. Will it happen, yes. Is it happening today? No. I have yet to know online or in person, anyone that has said, "Why get a 3DS when a tablet can play games too?" like... it is not happening. Again, will it happen? Absolutely. But is today that day? Not on the scale you think it is!

3) You are totally incorrect. If Vita were, as it is, $99 USD then it would be thee easiest sell in the history of video gaming consoles. I know, that is not a true possibility, but saying, "any price" is absurd.

4) With all that said, if you agree with me that price is the main factor in Vita's lack of success, then I could care less how you feel about anything else I said. My main point is that Sony saw the ship was going down and have yet to do anything to react to this crisis. It may be too late now, but if they had done something like Nintendo did then there is the possibility they would have better market penetration. They would still have to compete with the beast that is Nintendo, but at least they would have had a fighting chance. I have been calling it on 3DS and Vita since before they launched, $250 USD is too much to ask mass market to pay for a hand held console. The market results show I was correct then, and am correct now.

1) Again, you're totally ignoring how Playstation Suite games can be played on both the Vita and Android phones because of it's touch features--which gives devs a much bigger incentive to make their games compatible with both. Seems like pretty solid evidence to me.

2) The Wi-fi version is $300? Since when?

3) ...you can't play Pokemon on anything but Nintendo devices. -_-

With the tried-and-true offerings Nintendo has on deck, they're able to sell handhelds that aren't bleeding edge because they know they have a slate of games people want to play. With Monster Hunter gone, Sony doesn't have nearly the kind of software to sell the system on that alone, so they had to go big on the specs and features in order to give devs as many tools and as much freedom as possible. But they're in no position to eat a price cut on the device to get it into more people's hands right now, and have said outright they won't even consider it until next year.

Thus Nintendo was able to take losses for a while with a price cut, and Sony was not. That's the price trap the Vita has fallen into.

4) You can feel how you want, but Sony is clearly--and wisely, IMO--not as blase as you about the rest of the mobile space right now, which is only going to become more of an issue as time goes on.

Now that is how Sony could kill the Vita.