3DS as a console isn't a failure. But I think it's safe to say that the 3D part of it is one - and Nintendo admitted as much when they brought out the 2DS earlier this year. Officially it's just a way to create something parents are more comfortable buying for their children. But it's also an open acknowledgement that the autostereoscopic adds so little gameplay value that there was little or no incentive against shipping a version of the system that lacks it.
That's my take on the 3DS. The 3D part is a failure. Most people seems to turn it off and now Nintendo is releasing games that often disable it. The hardware wasn't ready at that price point.
My other problem with the 3DS is that they still haven't learned how to do downloadable software or online games properly. They're making the right noises on these issues... but it's not like it should have been a surprise.
On the downloadable software front I've finally just realized that Nintendo doesn't even want my money, especially when it comes to Virtual Console titles.
Can't figure out any other good explanation behind why they still won't let me buy Minish Cap. Sure it made sense a couple years ago when they wanted to make people who bought a 3DS before the price drop feel special. But that's far enough in the past that they're not earning any additional goodwill from it, so it's morphed into something more like, "Making sure these people still feel whatever shred of special-ness they might still feel from being 3DS Ambassadors is more important to them than earning more of my money."
Got similar suspicions about why they refuse to make SNES and N64 games available on 3DS Virtual Console.
The hardware wasn't the issue. The hardware at nearly any price point would most likely fail. The whole 3D on a 2D surface thing was a stupid fad that only manufacturers thought was a good idea. The 3D on a 2D surface is a failure pretty much anywhere you look. The only time it could be considered a success is when the consumer has little choice, such as a movie only being shown in 3D with no old-fashioned 2D option.
The only time 3D works is when it is not presented on a 2D surface, such as a VR solution.
Or a web browser that puts high-scoring HN submissions in the foreground and lower scoring items in the background. (Has anyone done a red blue glasses chrome extension for this?)
Apart from that the 3d is neat, but pointless. I'm sure there are some games that use it sensibly, but most don't.
It's weird to see so many racing titles on iOS and so few on 3 DS.
I applaud the effort to bring hardware / sensorial innovation on handheld devices, but yeah the 3D ended up in the gimmick bag. The only time people turn it on is to show how it is to newcomers so they understand why they turn it off.