The iPhone is popular for being non as an app friendly phone, and Sony knows it. There have been many rumors that Sony is working on a PSP phone, while that might not be true, we might see something very familiar. This new phone is meant to compete with the iPhone in the gaming department.

Sony plans to set up a project team as early as July to develop a new product that combines functions of its portable game player and Sony Ericsson's mobile phones, the Nikkei said.

Sayyed via reuters.com »