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Wednesday, December 22, 2010, 11:40 pm PT (02:40 am ET)

Sony taking cues from Apple for next PlayStation Portable

Sony executive Kazuo Hirai hinted Wednesday that the next generation of its PlayStation Portable handheld gaming device will learn from the popularity of Apple's iPhone and iPod touch devices, implementing new touch-based controls and broadening its appeal to casual gamers.

Though the executive's comments were low on details, Hirai, who oversees Sony's gaming subsidiary, teased the addition of new touch controls to the next-generation PlayStation Portable,The New York Times reports.

Hirai acknowledged that popular games on Apple and Google's mobile platforms differ from games for PlayStation devices. “The games being played on Android and Apple platforms are fundamentally different from the world of immersive games that Sony Computer Entertainment, and PlayStation, aims for,” said Hirai.

While Sony hopes to continue to appeal to the hardcore gaming fan base, Hirai also admitted that it will need to go after the new casual gaming base that Apple has helped to create. “We’re seeing people who never had an interest in games join the gaming population,” he said.

Sony's plan to keep up with the Apple's growing gaming clout is to beat the iPhone maker at its own game. By incorporating touch controls alongside physical controls into the next PSP, Hirai hopes to appeal to both casual gamers and more traditional gamers.

“Depending on the game, there are ones where you can play perfectly well with a touch panel,” Hirai said. “But you can definitely play immersive games better with physical buttons and pads. I think there could be games where you’re able to use both in combination.”

Hirai would neither confirm nor deny the development of the much-rumored Sony Ericsson PlayStation phone, but he did highlight the potential difficulties in differentiating a PlayStation smartphone from the PSP brand.

“We don’t want gamers to be asking, what’s the difference between that and a PSP,” Hirai said. “We have to come up with a message that users will understand. It would have to be a product that keeps the PlayStation’s strengths intact.”

Rumors of a PlayStation phone picked up steam when photos and videos emerged of an Android-powered Sony Ericsson smartphone with PlayStation capabilities. The device reportedly features physical controls as well as a multi-touch touchpad.

Gaming on iOS has received ample focus from Apple as it has driven increased revenue for the company. In September, Apple CEO Steve Jobs revealed that the iPod touch had become "the number one portable game player in the world."

Apple isn't content to leave Sony to market to 'serious' gamers. "Infinity Blade," an impressive iOS game based on the Unreal Engine and targeted at hardcore gamers, was released on Dec. 9 after being highlighted by Jobs in September. "That's on a phone," Jobs said after the tech demo. "That's pretty remarkable.

In its first four days of availability, "Infinity Blade" made over $1.7 million in revenue.

Earlier this year, Flurry Analytics revealed that Apple's iOS had eaten into Sony's share of mobile gaming revenue, growing from just 5 percent in 2008 to 19 percent in 2009. Over that same period, Sony's share of U.S. portable game software revenue dropped from 20 percent to 11 percent.

More recent statistics paint an even bleaker portrait of the handheld gaming market's decline and the rise of the iOS platform. The proportion of games played on the Nintendo DS or Sony PSP has dropped off by 13 percent over the last year, according to a report by Interpret.

Analyst Michael Pachter of Wedbush Morgan Securities sees the PSP2 losing out to iOS. "I think the big woody of the iPod Touch is cutting into the handheld market, I think the PSP is dead on arrival and I think the PSP2 is going to be dead on arrival. It looks to me like young kids are just as happy playing with an iPod Touch or a Nano,” he said.

Sony's not the only gaming giant worried about Apple. In October, Nintendo of America president Reggie Fils-Aime admitted that Apple is more of a serious threat than Microsoft and its Xbox gaming console. In May, Nintendo president Satoru Iwata reportedly called Apple the "enemy of the future."