Sony execs have declined commenting on rumors that the PSP2 is already in development. They also refused to comment on the speculation as to whether or not they are developing a redesigned PSP. The two rumors have created quite the buzz on the net. While many expected Sony to follow the Nintendo model and release a smaller, cooler PSP, the rumored details of the PSP2 have left some unsettled.

The PSP2 rumors include:

- The PSP2 will have have built in hard drive support
- The PSP2 will not use the UMD format (no backwards compatibility?)
-Nvidia will develop the chipset for the PSP2’s graphics processor (GPU)
- Samsung may develop a new memory card format for PSP2 games
- The PSP2 will feature a built in video camera capable of streaming to the PS3
- A built-in microphone will be included for video and game use
- 4GB or 8GB NAND flash storage will be available

These are nothing more than rumors, exciting rumors, but rumors, none the less. It will be interesting to see if Sony debuts a redesigned PSP or even alludes to a PSP2 at E3, in light of the fact that the show stealer will be the PlayStation 3 debut.