The Wii isn't much more than a toy you pull out every Thanksgiving and Christmas for family fun. Nintendo seemed to think it would dominate family rooms but the 360 and PS3 made better, faster strides in that area (Blu Ray, Netflix, movies etc); Nintendo eventually jumped on that bandwagon but it's pretty late now.
Rock Band/GH are still wildly popular, but that audience has reached its saturation point; you can't expect a casual audience to continue buying the same product and accessories over and over again. Likewise Wii Sports satisfies its audience, making stuff like Wii Party rather irrelevant.
The failure of the Wii is in the game designer's inability to create new games to further captivate the casual audience reeled in by Wii Sports.