Nintendo "failed" because of four things:
1.) they didn't offer enough content regularly,
2.) they also couldn't secure enough of the "big" franchises. No GTA/MGS/DMC hurt them. Not a wide variety of RPG's also hurt,
3.) the media size not being standard with the competition gave the third parties an excuse for not supporting the system,
4.) no online support from Nintendo themselves.
Still, I don't really see the Cube as a failure, per se. It offered some decent titles, and it brought back the Metroid franchise, albeit a fps, Zelda:TP looks really good, and Pikmin 2 was godly. Still, I wish they had alot more going on the system.