The Playstation Vita should just be a smartphone. Sony should pull out of handheld gaming.

[A2B24R246]

it seemed obvious from the get go to me that the PS Vita would eventually release and merge into the smart phone market while still keeping its identity to deliver better quality game experiences than its 99 cent counterparts (dedicated controls, bigger budget games, PSN (SEN))

Sony acquired Ericsson.....Check
Sony implemented a unique UI with similar design philosophy to a tablet/smartphone.........Check
A device that can go all digital.....Check
Current models deliver 3g and stress social functionality.....Check

I dont see how you could not come to the conclusion that PS Vita will eventually release a smartphone design along with a wifii only design (like iPhone/iPod).... it will probably be reminiscent of the slider design that was leaked from a dev kit:

Remember this??

When the slider goes down it acts just like your normal smartphone.....when the slider goes up it turns into your dedicated portable game console. Best of both worlds, and it would justify the current price tag to many

My guess is it's coming within 8 - 14 months $199 with contract OR $199 for a wifii only model with no phone functionality. depending on how the PS Vita does in the West, and how soon sony can improve the battery efficieny and implement a lightning fast 4G LTE antenna that will allow for fast enough speeds to play online wherever you are.

It would only be the natural expansion...remember Apple went from ipod ->iphone->ipod->ipad, dont see why sony and the ps vita cant do the same.