Supposedly the fruits of a joint effort between Sony and mobile partner Ericsson (Nasdaq: ERIC ) , the device in the photo features the obvious slick touchscreen interface, with gaming-controller buttons in a convenient pullout.
According to Engadget, the device will be yet another mobile handset powered by Google's (Nasdaq: GOOG ) Android, though the gaming aspect and controller will clearly differentiate the phone from other Android-powered handsets.
If the picture's for real, is Sony too late to this game? Rumors that video game console companies would get into the smartphone market have been bandied about for years. Xbox parent Microsoft (Nasdaq: MSFT ) has been slow to move in this space, and it's been in the mobile operating system business for some time.
Maybe Microsoft is wise to tread carefully. By entering the crowded smartphone market as an Android device, one assumes that a Sony PSPhone would also run the growing number of free or nearly free game apps that are available. Wouldn't this devalue the full-priced PSP and PS3 games Sony presumably hopes to sell to this platform?
That value disparity is a good reason for Sony and Microsoft to drag their feet, but the rising popularity of smartphones is already eating into the market for traditional game consoles. Hardware and software sales have been sluggish for nearly two years.
Apple (Nasdaq: AAPL ) may have disrupted the industry's pricing power when it rolled out its App Store during the summer of 2008. Research In Motion (Nasdaq: RIMM ) and Google's Android have followed suit.
If Sony can't beat 'em, it may as well join them -- or at the very least, phone it in. According to Engadget, the PlayStation Phone may hit the market by year's end, though an early 2011 release is more likely.
How many young gamers can afford the costly data plans that subsidized smartphone contracts require? Could Sony make up for lost time with a PlayStation-friendly handset? Or is Engadget's image just another piece of Photoshopped vaporware? The next few months should answer most of these questions.