I was checking out Games Radar Tokyo Game Show followup podcast and one of their comments about the PlayStation Portable caught my attention. According to them, the PSP has failed and Japanese developers are acknowledging it. These same developers believe that Sony will have a better chance next time around with the second iteration of the device. These comments stem from the fact that the PSP had a slim presence at the event with only two major games being showcased ("Metal Gear Solid: Portable Ops" and "Final Fantasy VII: Crisis Core").
I hate to say this, but the PSP is failing, that is if it hasn't already failed. Lack of quality games and the system's extremely high price point are to blame. Sure, the PSP's screen looks great, but I would be all for a cheaper screen if it would reduce the handheld's price. The Nintendo DS has a cheaper set of screens, but it doesn't hamper the over all gameplay experience. I'd also drop the UMD format altogether and create a marketplace based on downloadable content. Apple proved it can be done, and Sony has the media content to succeed. With the price of Memory Stick Duo sticks dropping, now would be the time to start thinking about such a service.
I love my PSP, but I wish it could have been a lot more.