Here is my take on this - http://gearnuke.com/playstation-vita-fail/

Very good article.

I think it's pretty clear that the Vita was not going to be a success from the beginning.  Sony did not anticipate the market moving to tablets and smart-phones so quickly and taking adults and young adults with it.  The Vita's target demographic had simply moved on by the time the Vita was on the market.

It would also seem that handheld spin-offs of AAA home console franchises do little to move the needle, outside the possible exception of GTA.  I think the perception there is, 1) that they're just spin-offs and thus non-canon, and 2) they're always going to be an inferior experience to the home console versions.  Some people have been trying to say that the big publishers abandoned the Vita because they saw Sony wasn't supporting it but the timing for that does not pan out.  Publishers stopped after the first wave of support, while Sony was still releasing first-party content, or else we would have seen a second wave of CoD or Assassin's Creed. 

The true draws for handheld consoles appear to be handheld-exclusive franchises that appeal to both children and adults.  With the appeal of the devices themselves on a sharp decline, as people already have devices that do a lot more, it's going to be entirely up to the software to attract consumers.  Nintendo is positioned to do just that but Sony never developed that type of IP on the PSP and the Vita paid the price.  Now, with such a low installed base, even if they did launch new IP that filled that role, it's too late to make much of a difference.  The only way I could see that possibly working is if they signed on with a multi-media IP for kids that was already mega-popular--and even then, it would probably be a bad investment for both parties.

How about both?

Seriously though, there are lots of factors.

- The proprietary memory cards jacking up the price
- Retail games can't be pirated, which would have led to inflated sales by cheapos
- Nintendo liquidating the 3DS price, leaving Vita in the dust
- No mega app to get people to jump aboard

Then here comes mobile which has flooded the market with lots of popular time wasters, so the the dedicated handheld game market had no choice but to see a decline from casual gamers.

Actually, the 3DS is tracking 47% behind the DS after 55 months on the market (54,131,288 vs 102,096,626). Compare this with the Vita which is 70% behind the PSP after 45 months (12,404,093 vs 40,981,343). Beyond that you are clearly correct in asserting that both Sony's poor decision making and the rise of mobile gaming have been major factors in the Vita's failure.

I have a couple interesting statistics to point out. After 24 months on the market:

DS = 27,130,143
3DS = 27,125,561

As we can clearly see the 3DS was not initially impacted by mobile gaming in any significant fashion. Let's compare this with the first 24 months of the PSP and Vita:

PSP = 17,424,390
Vita = 6,791,867

That's a 61% decline and it underscores the fact that the Vita was a really unattractive product that failed to appeal to PSP owners. It flopped right out of the gate and was more than 10 million units behind the PSP after only two years. Even if you take the 10 month difference in the 3DS and Vita's launch dates into account and narrow it down to 14 months (to eliminate the additional impact of the expanding mobile market on the Vita):

PSP = 10,884,696
Vita = 4,398,075

That's still a 60% decline and it largely exists because the Vita was unappealing for a myriad of reasons (most of which have already been discussed in this thread).

Mentioning launch dates here's some more food for thought.

The 3DS launched about 26-27 months after the end of the DS's peak year.
The Vita launched about 35-38 months after the end of the PSP's peak year.
The WiiU launched about 46-47 months after the end of the Wii's peak year.
The PS4 launched about 22-25 months after the end of the PS3's peak year.
The ONE launched about 22-23 months after the end of the 360's peak year.

If you wait too long to launch a system you allow your customers to grow bored and you allow the competition to fill the void. This was a major factor in both the Vita's and the WiiU's failures and I never see anybody discuss it. Why did Sony not launch the Vita when they still had some sort of presence in the handheld market? When you are not the market leader it is even more imperative to launch in a timely manner because you are dealing with a smaller userbase to begin with.

It's half and half.  

Mobile gaming took a huge, major bite, out of the casual gaming market space.  There are multiple meanings by the word casual, ask and ill explain further, but let it suffice now in general casual refers to people who are first time potential buyers, IE have never owned a dedicated handheld before, or are too young to be making decisions on what games they play and how they play them.

Nintendo lost quite a bit, I don't think the 3DS and all its varients together will sell half as much as the DS and all its varients (including the DSi).

Sony lost alot and I _do_ attribute that to a lackluster 1st party push and mayhap a proper push to get more mainline 3rd party games like monster hunter.  Sony failed to capitalize on the PSP's momentum.  They launched late and they didn't put up and instead they shut up.  Sony does not have the will nor the vision to push a dedicated handheld in a shrinking market.

Nintendo will remain the king in dedicated handhelds, perhaps forever, despite it becoming more and more a niche thing.

To achieve that though Nintendo had to swing in with the fastest and biggest post-launch price cut ever (I'm guessing) for a Nintendo handheld. And what have we seen in the interveneing years? An massive slide towards less than 50% on a launch aligned comparison. 

Come we know why nintendo did still sell 50 million because it has mario, pokemon and zelda on it. There is no sony franchise that can gurentee these kinda sales numbers and no matter what they bring to the tables. The only thing you can blame sony for is not releasing a vitaphome.
And second are gamers to be blamed as well, for not buying this great handheld

While that is certainly true I have to point out that the 3DS launched at $250 versus the DS which launched at $150. It needed that price cut because it was massively overpriced to begin with (not unlike the Vita) and once that barrier was removed it performed just as well as its predecessor, or at least until smartphones really became entrenched.

Once you cut through the mostly BS that Pachter was talking around that time, the end result is pretty much as he predicted, a massive decline in dedicated handhelds because phones and tablest will encroach on that market...with a lot of mainly Nintendo fans calling BS on that broadly accurate claim. Though strangely Pachter thought 3DS should have launched at $350, but maybe he was more just trying to defend his original prediction than actually put any logic into how a $350 price would work. The lesson for both Nintendo and Sony was, don't put too much tech into a handheld, because people are generally not willing to pay for it. Pachter also thought there was still enough of a market for dedicated handhelds to survive, and 3DS managing >50 million is a survivable sales base.

Whether Sony can or will have another go to at least get something closer to 30 million is uncertain, and from Yoshida's comments it looks like a no for the forseeable future. Personally I think phones are poweful enough to be able to run handheld console type games, which means if Sony makes a "Vita" clip on device that can attach to phones with, say 4.5" - 6" screen, that might be a more successful direction for Sony to head in the handheld gaming area.