I think incorporating a cell phone into the PSP might be interesting - it's a handy feature to have in the machine - but Sony really needs to focus on software. PSP could be huge right now, but the games it needs to succeed aren't being made. Basically you have Grand Theft Auto and little else. Well, there do seem to be some other worthwhile games, but they're not big names. Where is a true Final Fantasy game for this system?
I'm reading oohhboy's article, it's pretty interesting. One thing I found neat was that Kutarugi apparently expected Microsoft to enter the market years ahead of time. I'll add more thoughts when I'm done.
Edit: something just came into focus for me, while reading this. A lot of people saw Nintendo's online "strategy" as weak this generation, but Sony's was hardly better. The main difference is that Sony had five times more users...and it also released a couple of online games itself. Microsoft has won the online battle - up to this point. Friends codes are a pain, but I think the zero-dollar cost of Nintendo's online service will prove to be popular. According to the article Xbox live has 3 million subscribers but Nintendo WiFi has managed 1 million in under a year.
Ah ha ha ha, best quote from the article: "'I bought shares in mighty Sony,' cried a woman whose holdings had lost nearly two-thirds of their value."
You know, the conclusion to the article calling for, "no more wars in the living room", is interesting. Does Sony need to fight that war? If Sony had ignored Blu-ray and released a new console similar to Microsoft's several months ago, it seems to me that the company would be in much better shape. Maybe they would have had to ignore Cell Processors too. Ultimately these technologies could pay off big-time for Sony but they don't offer clear advantages for games or gamers, so they could be the downfall of the product.