No, they just messed it up.
I don't blame you, though; even they haven't figured out their plans for the Vita, how could you?

Sony is just purposely tanking Vita due to strong evidence that MSFT was eyeing the portable market seeing how PSP managed large sales despite being a distant second to DS. Sony has bribed certain board members of MSFT to adamantly deny any portable initiative citing poor Vita sales as evidence. Once MSFT decides to dedicate its resources @ invading other markets, Apple's, Sony will announce the biggest software lineup in the history of men.

Well. being a Sony fan, I certainly disagree to the idea expressed by OP as Sony's gimmick. Even Kaz admits that the Vita's performance has been on the lower end of their expectations. IMO, pretty lower end. It needs software, more and more along with 1st and 3rd party devs support. However agreeing to the rest stated, it's too early to write it off.

A company that isn't making money and has to restructure, purposely releases a high end product to not sell well and lose money on each unit sold??

Brilliant business strategy!

The product will begin to sell better the longer its out on the market as games are released but I guarantee that Sony didn't want this for Vita

If your handheld is being called a "Portable PS3" then yes, it is. If they were able to make the Vita a graphically powerful handheld without the 250$ price tag then I (and many others) wouldn't be saying it was a bad idea to implement such a large amount of power.

There is a difference between overpowered and up to industry standards. The Vita is right up there with the new iPad in terms of power, but at half the price. I call that affordable. Should the price be lower? Sure. A $199 price point would help them appeal to the mass market.

Little does everyone know that this is Sony's version of subsidizing the PS4. They've been selling us the controller for the past year, so the system isn't $599 when it comes out!

I never understood Sonys target market. They were targeting early 20s men who likely are out of college looking for a job with a few priorities ahead of buying a handheld like rent and groceries. Nintendo has the advantage of appealing to the kids as well as adults who grew up playing Nintendo. When Nintendo announced the 3ds with a new kid Icarus, I was instantly on board. As a 28 year old gamer (at the time) I hadn't been more excited for a console in years. 3d gaming and a sequel to kid Icarus were things I could dream about growing up in the 90s.

249 (controller) + 598 (console)