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PSP Go itself was bad because it was ahead of its time; at its release, America at least just wasn't ready for an all-digital device. You'd be surprised at how many people rely on physical copies and don't do digital at all.
The PSP in general floundered near the end because of lack of games, obviously. Piracy was probably a contributing factor, as well, but piracy was prevalent on the DS as well. The Vita is floundering the same fashion and is not affected by piracy at all right now. Nintendo does so well in the handheld space because of prior success as well as successful first party games to attract third party developers.
To be a 3rd party, you need an office with a good safe at least. :-/