Yeah, there are other reasons it's not really the issue though.
I'm going to come out and admit that I like the Wii U, I have all last gen and current gen consoles, and it's one of my favourites. It's not got the power of my PS4 or my X1, and sure it's been screwed on 3rd party game support leaving it few titles.
But it does have some quality titles, at the end of the day Nintendo has still put out more high quality 1st party titles that deserve game ratings in the 90%+ range than Nintendo and Sony have managed to acquire even with heavier 3rd party support.
Though it doesn't really matter, because Nintendo games are DIFFERENT. I don't play Wii U because I want to gun some bitches down, I don't play Wii U because I want to rip someone's heart out, I don't play Wii U because I want to pretend I'm a wizard battling vile demons in dark dungeons full of dismembered corpses. I play Wii U because sometimes pratting about bouncing around the screen or doing puzzles with colours flying at me left and right is actually also fun, and the Wii U does that like no other. So I'm not saying I think the Wii U is the greatest thing ever, it's not. What I am saying is that it's a fantastic complimentary console to the X1, the PS4, or a PC - it has it's place alongside the big hitters in providing a type of fun that the others just do not offer.
But despite my love for the Wii U in spite of it's failings, I didn't even know this TVii service existed. I've never heard of it or seen it, or if I have then it was so irrelevant that I've forgotten about it.
I'd say that if this failed, it failed because most people didn't even notice it. Certainly I never did and I suspect I've put as much time into my Wii U as your average owner, if not more. Tracking would be the least of my concerns if I never even really noticed it was there, or what it did to even use it so it could track me in the first place.
I'd say this is a failing based more on the fact it's a service few people even realise exists, on a console which hasn't sold well. Combine those together and you'll end up with a userbase so small that it's just not worth the cost of supporting. I'm not surprised therefore that the first I hear of this is that it's shutting down, and as a Wii U user, I don't really care either.