Contradictory rumors swirl around the future of Sony's portable gaming unit the PSP. Last week, a British gaming blog reported no successor to the PSP is in the works, but this morning Eurogamer.net quotes unnamed sources saying game publishers are already designing games for the "PSP2."
If a PSP2 really is coming, let's hope Sony throws the current model out the window and reimagines the portable gaming device from the ground up. The PSP is fighting, and losing, a two-front war in portable gaming. The Nintendo DS is handily beating the unit among younger and more casual gamers, and with adults the PSP finds itself under attack from Apple's (AAPL) iPhone and iPods. Apple is increasingly marketing the iPod as a gaming console, and there's an ever-increasing library of games, with a lot of good ones either free or for 99 cents.
No wonder both Credit Suisse and Deutsche Bank AG recently cut their ratings on Sony.
Sony has the opportunity to turn things around with the PSP2, but it needs to reevaluate its whole mobile strategy. Consider how Sony has spread itself thin, competing everywhere but dominating nowhere:
- Mobile books: Sony is putting up a fight against Amazon's (AMZN) Kindle among portable e-readers.
- Mobile games: The PSP is getting squeezed between the DS and the iPod.
- Mobile music: Sony, which once owned this market (remember the Walkman?), is set to debut an iPod touch clone at CES we doubt will put much pressure on Apple. Microsoft (MSFT) has tried and failed for years to take on the iPod with its Zune.
- Mobile phones: Sony Ericsson has warned that its business will stink this year.
Now imagine a PSP2 that did all four of these things really well, packaged as one device. Sony remains one of the few companies with the capability to build a meaningful rival to the iPhone -- and Microsoft, one of the few other companies with that capability, recently insisted there was no plans to build a Zune phone.
See Also:
Not Just The PS3: Sony's PSP Sales Stink Too
Apple's Holiday Pitch For The iPhone: We Have Great Games
No Zune Phone Coming At CES
