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Last updated: Monday, June 29, 2009

In a move to compete with Apple’s iPhone and iPod, Sony may develop a hybrid cell phone-video game handheld with the PlayStation Portable device at its core. The Nikkei business daily on Saturday reported that the Japanese electronics maker is looking for ways to regain its dominance in the portable electronics market. Sony introduced the Walkman 30 years ago, but Apple has overtaken the entertainment company since the rise of the MP3 format. A PSP phone may be a competitive solution. According to Nikkei, Sony is planning to set up a project team this summer to develop a new electronics device that melds the capabilities of the PSP with its Sony Ericsson mobile phones. “Increasingly the phone is being used for more than just making phone calls. Games are one of those features,” said Michael Gartenberg, a vice president at Interpret. “It is not surprising that Sony is looking at the possibility of integrating a telephony device or a connected device into the rest of the PSP ecosystem.” Who Can Beat the iPod? This would not be Sony’s first attempt to challenge the iPod’s success. In 2004, Sony launched a MP3 compatible player under the Walkman flag in Europe. It was Sony’s first flash-memory foray into a realm dominated by Apple. At the time, a Sony executive predicted the new models would further develop the credibility of the Walkman brand in the personal audio market. The product did little to grab market share from Apple. Even though iPod sales were down 16 percent year-to-year in February, Apple sold more than 11 million iPods in the non-holiday quarter alone. The NPD Group reports that Apple’s digital-media-player market share is holding steady at more than 70 percent. Some analysts have speculated that the iPhone has cannibalized iPod sales, making the iPhone the closest device to an iPod-killer…

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PSP Game Players May Be Able To Phone Home

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