The Vita has been an absolute failure. The hardware's was too expensive, the games are crap, the price is just telling people to not buy it and it is just getting owned by the competition.
I'm basing this on Metacritic scores.
Let's start off with the games. Heavily promoted games such as Assassin's Creed Liberation, Call of Duty Declassified and to an extent, Golden Abyss have flopped. Middle tier games such as Gravity Rush, Metal Gear Solid HD Collection, FIFA, Wipeout are well OK games but these don't sell systems. Then there are the flops - FIFA Soccer, Madden, Lego Batman, Smart as, Silent Hill.
Also look at the launch games which like the 3DS were crap. The highest rating on Metacritic with 85 was Tales From Space: Mutant Blobs Attack. The games at launch have to be some of the best but instead it launched with games that were either crap or mediocre.
LBP has been a success. It'd be interesting how All stars battle royale and Sly Cooper do.
The Vita has some good specs for a handheld but from a business prospective it's not viable. Tablets and smartphones now have hardware that is equally or superior to handhelds. Not to mention the terrible battery life compared to tablets and smartphones. But the biggest hardware problem has to be the lack of internal storage. The Vita comes only with 1 GB of cloud storage. For storage though you'd have to rely on the expensive memory cards. For comparative purposes the 3DS has 2GB of internal memory but importantly it can support cheaper SD cards. The Vita also has a 3G connectivity version but that waste and not very useful. Now Apple willvery soon release the iPad Mini and I think given the cost of the Vita + storage compared to the iPad Mini which will be very similar, the iPad Mini will destroy the vita.
THE PRICE AND COMPETITION
The question I ask myself is this 'Why would I want to buy a Vita? Is it the games, the hardware, the connectivity, the features?' The Vita is also not cheap. This is 2012 not 2004, there are tablets and smartphones now competing for the same customer and the handhelds are unsurprisingly, losing. Tablets can play fun games at extremely low prices. The vita generally has 'hardcore' games. But people already have their console to play those games. These days tablets and smartphones can pretty much do anything a handheld can and more.
The 3DS has found some success recently with it's low price, unique features (or gimmicks) such as 3D and street pass and importantly backwards compatibility. In my opinion, this is why the 3DS has sold OK so far. It's something now Sony should have done. For starters though, it should significantly lower the price.