They have phones with the Sony name on them, and a massive amount of mobile patents, but in reality Google is in the Smartphone market using Sony's name. Moving to a PlayStation Phone, based on the PS4 hardware, and powered by PSN, Sony would really be a mobile player. This would actaully start to make them money and help them expand their business.

The thing is, Sony will be able to make a $400 PS Phone when the time is right. They will be able sell at a break even because they will own the hardware, the OS, and the ecosystem, something that they will never have with Xperia and Android. Right now phones are highly over priced because most manufacturers rely on the actual sale of the device, because once it is in the consumers hand google starts racking in the cash. Apple on the other hand takes advantage of the outrageous prices android parteners like Sony, LG, and Samsung have to sell at for minir profits or even losses, and sell their units at hundreds in profit prr unit, then they continue to rake in cash once the device is in peoples hands, because they on the OS, the hardware, and the  ecosystem.

Also in this move Sony could not simply only sell handheld form factor devices. Slab style PlayStation phones, and a pure wifi only handheld product would have to be available as well. However, I believe that this time around the benifits of 4G would absolutly dominate the non connected device, because 4G would offer full access to online gaming, and all other servuces found on home consoles and smartphones.

Obviously this would not knock android and ios out of the market, but it would definitely be highly successful. A PlayStation phone would be a 200 million seller in the first 5 years. It would sell over 40 million in Japan alone. This is something that Sony absolutly has to do if they want long term success with the PlayStation brand, and it they ever want to get back into the mobile market.

I think Sony will never release handhelds again. The only thing that may happen in the future is a phone with exclusive Playstation service with mobile games. Sony were talking about the possibility of releasing mobile games based on Nintendo's success with Pokemon Go. So why not?

The problem is there is no way to do that on Android, and there is no hardware that could do PlayStation games justice. A phone that has PlayStation Services and Mobile games could only happen via Sony's own OS within the PlayStation ecosystem. At that point they might as well just fold Sony Mobile into Sony Interactive Entertainment and rebrand their phones under PlayStation.

Even if for some reason they went ahead and did another Xperia Play, it would be a disaster. Then they would have in house competition between Sony Mobile and Sony Interactive Entertainment. Any functional business is not internally competing with itself, and escpecially competing against the comapny itself, which is exactly what is happeing right now with Xperia Phones and Bravia TVs running on a competitors OS.

Sony is going to develop games for android and iOS through SIE via Forward Works, but they will not be real games, they will simply be little throw away titles like Pokemon Go and Mario Run to keep a pressence in the mobile space, and keep up brand awareness. Just like Nintendo is doing with their current phone games, they are only there to keep them in the spot light. Switch is the real deal for Nintendo, they want people playing on their device, on their network, because that is where they make the real money.

It won't be hard to make some Playstation Service app for Android. The problem is that Android is an open platform so it won't be hard to install this app on any other Android phone (Samsung for example). The problem with PS OS on the other hand is that it will be hard to convince developers to make apps for this OS. You can see that even Microsoft has this problem with Windows Mobile. So there are few people who buy Windows smartphones. Because smartphone without apps is nothing nowadays. 

That is why Android would never work, if their intentions are to increase their hardware presence. No matter what they do on Android, hackers will make it possible on other phones, and people will just stick with their LG, Smasung, or HTC device.They already had this happen with Remote Play, which was supposed to be an Xperia exclusive.

As far as apps go, they have to take the same approach Microsoft is taking right now. They have 60M PS4's out their already. They have to leverage that by allowing developers to create apps that work across the entire PS4 range. Like you said, Microsoft prooved you can't drop a mobile device on the market with a Zero userbase, and hope it sells well enough to establish developer support. That is why they started the Universal Windows Applications push, and are currently readying the Surface Phone as their next attempt at the mobile market. This time they will have the apps, and the totally connected ecosystem they need to compete. Really, if you look back in time, even the iPhone had the advantage of the iPod userbase, which devs were able to develope for in addition to the the phone giving them much more incentive, utilizing your ecosystem as leverage is really the only way to break into a new market.

Finally, the one thing that a PlayStation Phone has over every other devices in the moble space, is that it would be the only place where you can continue playing Fifa, Call of Duty, NBA 2K, GTA, Gran Turismo, and so much more. No other phone would have the ability to allow gamers to play online matches with their friends at lunch, recess, break, or on the way to work/school. That alone, would be enough for some to look past the smaller inital app selection. As I have said before, they won't sell 100M devices day one, but in 5 years, they definitly will, and most likely even quicker than that. The best part about it is, being built off the PS4, most of the work is already done, and each unit sold would produce massive profit. 50 million PS Phones would be like selling 500 million Xperias, and best of all, it will continue to bring in revenue and profits for years, as opposed to it only being about the point of sale.

UWA doesn't really mean Microsoft will suddenly have apps on Win mobile. Because they need to convince developers to build UWAs first. Win mobile will have advantage of UWA if some developer would want to part his PC app for example to the phone. But this developer would need to start building UWA first of all. Win32 is still more popular for Windows PC development. I really think that Xamarin acquisition can benefit MS more than UWA.

As for PS Phone, I don't think that streaming from PS Now is a good idea right now. Mobile networks quality are still kinda poor and it is gonna be hard to play the games you mentioned with input lag. Also, Sony will need to invest money to make OS for this phone or even port PS4 OS to it which can be a problem for them. Android is safe bet right now because they don't need to spend money on making mobile OS with it.

We'll have to see, UWA was the whole reason Microsoft gave away Windows 10 for free. They need to get eveyone with Windows devices on the same page, and make it so UWA is the only real choice when it comes to developing app for the PC enviornemnt. 

As for PS Now, I don't see that working out well either. If they do a PS Phone it has to be able to run PS4 software natively. This should be possible in a phone form factor with 7nm fabrication. So, I don't expect a PS Phone any sooner than 2019.

So you're thinking of Sony's hypothetical long game here. That's more interesting than theorizing on a Vita 2.

It's hard to imagine a future in which the Playstation is no longer a console box, just as it is very easy to imagine the Playstation 5 as being an upgraded $399 PS4 Pro with a new operating system in 2019.

Much of how the 9th console generation will develop, will have to do with the market reception of the Switch. And it should be clear that Nintendo is kicking off the 9th gen with the Switch, all arguments about specs determing generation aside (which I will assert is false). It could be a failure, which would mean terrible things for Nintendo in the market as this time both the 3DS and Wii U portable and console markets are being placed into the same basket, leaving them with no leg to prop up the other. 

It could be received with the same level of enthusiasm as the Nvidia Shield (medicre), but the key distinction is Nintendo is a software company with its own top of the industry level IPs; the Shield simply played other developer's content. 

And of course, it could be received so well that we see a run on hardware not seen since the Wii, outstripping supply, although it's more or less irrefutable in hindsight that Wii demand was propped up by market demographics that were one and done. They bought it for Wii Sports. Some stuck around for Wii Fit, and that was the end of their video game console experience as evidenced by the cliff like drop off of Wii U buyers. 

In the case of the later, Sony could potentially follow suit and base the future Playstation environment on portable technology as it continues to mature to the degree that it is somewhat competitive with desktop power ICs, which reflects existing trends in the semiconductor industry towards lower power consumption rather than increased computational capacity. Moore's Law is running out of steam. 

At any rate, if that hypothetical scenario turns true for Sony, the future of Playstation will look more like the Nintendo Switch than another set top box console. We wouldn't be seeing a PSP Phone or PS Vita 2 (personally, I think the Vita name will be killed off simply because the PSV underperformed and one doesn't continue to brand build off a more or less commercially failed product) so much as a Playstation 5 that only exists as a hybrid/portable unit. 

I still don't see the phone and data network service in the future, but we'll see; we are talking about years from now. Potentially, all electronic devices will be network capable in the future, not just gaming devices. 

I am definitly talking about the future. I don't see any chance of a PS Phone having success anytime sooner than 2019 or even 2020. So this is a ways off. 

However, I think that the PlayStation hardware portfolio will grow beyond just home units. I think that PS5 will definitly be another super optimized PC. The PS5 will deliver industry leading 4K graphics with next generation visaul effects. It will be the industry leader in high end Virtual Reality and Augmented Reality. The PS5 will be for a good majoirty of people the data center or server of their computing world. I think it will be a bigger device than the PS4 Pro, and launch it $500 for the base unit, but it will have options day one for even more powerful units. I think PS5 will arrive around 2023 - 2024 when 3nm fabrication is matured enough for mass production. 

Along side the PS5 home unit, I believe we will see a Portable Home device in the form of a Laptop/Tablet, and finally a Mobile Line of products that features a Handheld/Phone Hybrid, a Slabphone/Smartphone model, and a Wifi only version of the Handheld/Phone device. All devices will be built on the same hardware design, and all software/applications will be made to scale between the products. 

I actually expect this to start with the PS4 family of products, over the next few years. Basically, I see the future release schedule being;

PS4 Laptop/Tablet 2018

PS Haldheld/Phone, PS Slabphone, and PS Portable 2019

PS4 Super Slim, PS4 Pro Slim, PS4 Ultra, PSVR Slim, PSVR Ultra 2020

PS4 Laptop Slim, PS4 Laptop Pro 2021

PS Mobile Products Pro and Slim Revisions 2023

PS5 and PSVR 2 2024

All products will continue to get the yearly updates Sony always does with 1100, 1200, 1300, etc. inbetween major hardware revisions, assuring they allways keep up with the newst standards for wifi, bluetooth, LTE, etc.

All PS4 family products will be able to interact with PS5 Products in the beggining, eventually phasing support out near 2030. All Software will be scaled across all platforms unitl PS4 support is dropped. No additional features will be added to PS5 games, because PS4 will be able to keep up with PS5, although it will only be able to display games at 720p/30fps with much more simple graphics. 

Sony will be able to do this on the cheap, because although they will several products on the market, they will really only have 3 basic harware configurations at all times shared between the devices. 

To understand this it has you have to look at PlayStation as the future of Sony's consumer electronics products. They sell multiple TV's, Smartphones, A/V Recievers, Blu-ray Players from $100 - $50,000. They have a wide range of products that reaches a highly diverse market. PlayStation will be built to reach this market in the future, as Sony focus' on unification across the entire corperation. This is basically the rebuilding Sony from the ground up with PS4 being ground Zero. PS4 is Sony's iPhone.

Yep, many people seem to forget that PSP was the premier portable multimedia device for about 4-5 years and was a huge selling point.

By the time Vita released, everybody and their mother had a smartphone or tablet which made the multimedia functions of Vita old news.

Obviously Vita had other issues that contributed to its failure but that was one of the bigger ones.