A hand-held as powerful as the ps3.................hmmm........yep.......IM GETTIN ME ONE OF THOSE! Lol though seriously if this ends up being a "$599 US $!" announcement again i will cry :(

Alright, Sony! Looks like ill be able to run AutoCAD on the road on this thing.

While it is entirely outdated compared to what a console that could be released today would look like, it isn't THAT outdated ...

With the iPhone 4 and iPad we have (expensive) portable devices which are (probably) more powerful than the original XBox; to get near the XBox 360 and PS3 is going to be very expensive, unless this system is releasing in 2012 and is based on a 22nm manufacturing process.

Can't afford it guys?  Well, you can always get a 2nd job...

I have mocked the idea of a PSP2 since I heard the idea, but now I am beginning to gain interest. If Sony does this right it may just be a worth while product for me. I assumed they would try to keep it cheap, and thus, it would be a very minimal upgrade over the current PSP. However, they may just blow my mind and play the play book I thought unpossible.

Here is what this story rings in my head. Sony is queuing up a four prong portable attack. 

PSP - The current PSP sees a redesign with touch screen, slide open PSP Go case, built in UMD drive, and a $170 price point. Sony allows devs to make games that use the full 64MB of RAM in PSP's generation 2 and on for all future games. This has become the standard in the portable space, with every company upgrading on a yearly or sooner curve. Games could also support PSP-1000, but expect performance to be terrible, as they push PSP-1000 user to upgrade there unit. PSP-3000 sees a drop to $149.99.

PSP Phone - This device, is going to be there money maker. It will be the new PSP as stated above with network capiblility, and an always on connection. 

PSP2 - This is a pure gaming powerhouse. $600 - $800 to start making the system profitable from the start. Only for those that are serious about gaming on the go. No bullshit, no fluf. You either want it or you don't.

Tablets - Ranging from $400 - $1000, available in many forms, made to combat the raising tablet market. 

In the above case, they make profit on all of their devices meaning they can't fail financially. That is the most important thing in the current economic situation of the world. PSP2 may not be a hot seller, but I think they expect enough hardcore gamers, to be around to make it a viable platform. Even if they are wrong. They still have PSP, PSP Phone, and Tablets, and they never lost a dime.

Really what other option do they have with PSP2. Is a $250 unit going to be anything? All they would have is a system well behind all the competition. It would be two years behind at launch. How about a $400 dollar PSP2? Well now you are talking a device with current phone specs, but no plan to make it attractive. All they can do is trying something crazy, and if it works, cool, if not, make sure they don't loose big.

Um, what makes consoles any different? The bestselling games on all systems, and those with the best legs, focus on fun. Those that have good graphics are not the reason they sell. People didn't make Call of Duty into a top tier franchise because of the graphics.

i didn't say the PS3 is outdated, the SPECS are outdated, lower res = less resorces = easier to do "HD" graphics.

hope it won't be as costly when at launch. here is the thing, does PSP2 use the same cell/rsx achitecture? how easy is it to make a game for both PSP2 and PS3?  to me, the biggest selling point is to carry over PS3 game saves and play it on PSP2 when I'm not at home. If sony can't enable this, i don't see much reason to favour PSP2 over, let's say, 3DS.

having ps3-esque gfx on a handheld can't be hard by now tbh, and I expect no less from a next gen handheld

Dumb down the resolution and you might make it work.