PS1 games and a solid redesign (preferably with better battery life, load times, built-in memory, maybe a brighter screen) without increasing the price would sell it to me.

I don't think the Playstation Portable will ever sell enough for Sony to create a redesigned model.

I don't think Sony is in a position to do much more. As I undestand it the PSP is finally profitable to a small degree and with the mega losses from the PS3 I don't think Sony can lose any more money in its video game division simply to push sales. It's time to pull back on the PSP let it make as much money as Sony can off it as it cruises along on autopilot. Sort of like what Nintendo did with the GameCube after 2004. To the extent anything should be done, Sony should start getting a better business plan ready for the the PSP2's challenge to the DS Advance.

Sony has been making a profit from the PSP for a long time.  I reckon they are still making a reasonable profit now even with the price reductions WW.  You don't lose money on a system that has sold 22m units WW unless it cost more than double to manufacture than they were selling it at launch.

Various Sony officials have claimed that a redesign is on the cards for some months now...which means that it's been in development for some time.

Sony hasn't dedicated enough time to the PSP, they have already publicly stated that.  And they now know that they can make money to keep them going for a while yet, while the PS3 is struggling.

I reckon a redesign of the PSP will appear near the end of this year or early next year.  And even if Sony produce a PSP2, I now feel that it could be another 3-4 years before we see it....and it will have to be backward compatible with the PSP as well...so still have a UMD drive.  Although the PSPLite could have a quicker UMD drive fitted as well. 

Thanks alot Dolla Dolla it works finally

PS store is coming to the PSP, they announced it just a matter of time. Probably will be announced at E3.