sigh are you seriously trying to question how horrible the PS3 situation was for Sony? Here's a quick google fu cuz I need to head to bed now (3am :S)
http://www.vg247.com/2009/10/30/sony...launching-ps3/
and let's not even talk about the loss of marketshare coming from the PS2.
And PSP was actually doing pretty well back then too afaik...but they stuck it through and was able to turn it around. Could the vita have been the next PSP? hell no. But could it have been way more successful and actually earn the company some solid returns over the years? You betcha...there's also an ethical/responsibility aspect here too but that will be a whole another topic and I'm too sleepy for it.
There are other risks involved obviously when dropping support for a product but Sony came into the vita situation with a short sighted hardware design (the fk is the track pad for?), poor philosophy (eg: memory cards as a means of overcharging consumers which is dumb as hell) and no solid software line up planned. (yes the system had some good games but it's missing almost all the main franchises that made the PSP sell up to 80mil..it's their job to make sure they make it over, at least some of them)
So no there is no convenient excuse to blame the failure of the Vita on the market itself when the company behind it has been incompetent in it's vision and support for it. Hell they can't even spend 5mins to show a trailer for a fantastic looking game like Freedom Wars at E3 or Gamescom. It made me laugh when I saw some gamers saying yeah we don't want vita, give us PS4 stuff..and sony spend a good chunk of time on shit like wonderbook and Powers lol Time well spent..good job exec/planning team for the events.
anywho my 2cents on the whole topic. Got nothing else to say really. Cheers off to bed I go