According to the WSJ, it is!
The sales have gone down, and most experts blame it on the price of the console. Which may indeed be the case. Dave Rosenberg at CNet has some more viewpoints to share. Not just price, but also lack of exclusive games (I agree), not enough community stuff (yup!) and just being out-marketed.
I add a personal one: it is an absolutely horrendous design that no-one wants to have sit on their A/V rack. Big fat ugly bastard console.