The Wii U's problems boil down to high price, lack of software, and it being too derivative of its competitors. Hardware wise, it's very similar to the Xbox 360 in performance, except with double the memory. Which gives it a slight edge. Though not enough to give it a noticeable advantage to Nintendo's target market. The 360 has a big competitive advantage as it's cheaper, has a more robust library of inexpensive games, and Kinect is a big attraction for casual gamers.
I think Nintendo did make a big mistake with the tablet, as well as pushing motion to the back burner. The motion controls were the Wii's biggest attraction. Leaving the hardcore Nintendo fans aside, tablet gaming isn't a big lure for casuals. Especially those who already own a tablet. Yes, the Wii U has bigger games but I don't think that matters to this crowd. They want something they can pick up and play. Most of the Wii's top selling games are like that.
Price puts Nintendo is a sticky situation. It's more expensive than competing consoles but Nintendo is still taking a loss on each one sold. That makes a price cut difficult.
However, I do think it can be saved. The 3DS had very similar problems in its first year. Seems Big N didn't learn from that fiasco. Software will be key. They can't keep recycling old games, like they're doing right now. The Wii U will have to have unique, exclusive triple A titles. Exclusive being the key here. This is where the company needs to start sinking its money.