The PlayStation Phone

Only if Sony doesn't do a thing to lock the software up. Maybe they could add SPUs to the phone, or something that would lock the software to the platform.

I'd be surprised if they don't have custom graphics hardware, of some sort, in there - I imagine the last thing Sony wants is to commoditise themselves by providing the same hardware platform as normal Android phones.

Even if they don't have custom hardware, I'd be shocked if they didn't have some sort of silicon DRM to stop the software running elsewhere.

Sony has trailed in digital music, online video, and casual/social gaming. I'm glad that Sony is trying something different to get ahead of the curve as portable gaming converges with smartphones. There are several reasons, however, why I think this device may struggle in the market.

For instance, who is the target market? Kids and teen gamers who buy a PSP or DS (I assume parents often pay) or young adults that currently buy an Android phone or an iPhone?

If the target market is kids or teen gamers, will they be able to afford the price of the device plus the monthly voice/data plan? For instance, while 33% of teens aspire to own an iPhone, only 14% of teens actually own the device, down 1% from the prior year (Fortune, 2010); perhaps this decline was due to the recession or the emergence of Android phones.

For teens and young adults, will this device appeal to them as a replacement for an iPhone or for a different Android phone? The iPhone and select Android smart phones (e.g., Motorola Droid) have functional value, but also serve as a fashion statement. For many, the phone you choose is an extension of your identity (e.g., like your choice of car). How many teens and young adults will identify with a Sony PS phone with built in PS controls?

Perhaps Sony can overcome the cost of ownership issue by partnering with a discount cellular carrier, such as Virgin Mobile or Metro PCS. The second issue about the appeal of iPhones and select Android phones is more of a challenge. The device as pictured in the Engadget article looks interesting. But how many teens and young adults will shy away from the built in PS controls (and the bulk that this adds to the device)?

What are thoughts on how this device will perform in the smartphone market?

side talkin all over again.

Not really, it's a well known factoid that their not-invented-here syndrome is pretty much the reason why the iPod is the leader of portable music players and not the WalkMan.

They going with android and SD cards sounds like a good move to me.