PSP2 is dead on arrival

Profoundly blurry pictures and hearsay – as far as the PSP2 goes that’s as concrete as it gets for now, but the evidence is seemingly more than enough for outspoken US analyst Michael Pachter to write off the machine before it’s even revealed.

I think the PSP was dead on arrival and I think the PSP2 is going to be dead on arrival,” he explained on his Pach Attack webcast.

However, Pachter’s warnings weren’t just for the PSP – instead, he fears for the very viability of a handheld space he sees being increasingly controlled by Apple.

We’re approaching saturation in the handheld market,” he added. We’re starting to see DS hardware sales crack, the iPod Touch is cutting into the handheld market. It looks to me like young kids are just as happy playing with the iPod Touch.

The 3DS will prolong the handheld market for manufacturers, but ultimately I think handhelds are in trouble. What’s the difference if you play Tetris on an iPod Touch or on a DS? Well, you pay a buck on the iPod Touch and you pay $20 on the DS.

After the 3DS has had its little rush I think the handhelds will continue to decline.”

Last month Ready At Dawn developer Ru Weerasuriya said PSP was doomed from the beginning”.

Since its launch in 2004 the PSP has sold a staggering 60m units worldwide, making it – in raw unit terms at least – one of the best selling consoles ever made, lagging only behind the PS2, PSOne, Game Boy, Game Boy Advance, Wii and DS.

It’s currently the second best-selling games console of 2010 in Japan, ahead of the Wii and PS3 and behind only the DS.