"The a UMD-free Playstation Portable 2 is indeed real and could hit as early as this fall, David Perry, chief creative officer at Acclaim, told Kotaku today.

'I spoke to a developer who is working on it right now,' he said. 'I know this developer is already working on it, so that means they have a prototype. That would sound like a fall release to me.'

Perry said he is excited about the news.

'I've been pounding on Sony for a long time to make the Playstation Portable relevant and not to let Apple stroll away with the portable game market,' he said. 'Look at what Apple is doing now. Why are so many investors investing in Apple game development? Trying to pitch a PSP game to investors right now is brutal.'

The idea of a UMD-free Playstation Portable begs the question of how games will be loaded onto the device.

Perry believes it will be done through digital downloads and direct connect to a computer.

The ultimate goal, he says, is for the Playstation Portable to go 100 percent digital. Not only would that allow Sony to have a more direct connection with their customers and get a larger piece of the sales pie, it would essentially kill the used game sales market.

As a stop gap to keep retailers like GameStop interested in selling the Playstation Portable 2, which they make little to no money on, Perry thinks that Sony would at least initially sell games for the device on Memory Sticks, as they currently do with some movies, or with pre-paid cards.

As for backwards compatibility, it stands to reason, Perry says, that all current PSP titles would show up on Playstation's online store.

While Perry insists that the PSP2 is real, and already been developed for, a lot of the details about distribution and release are more speculative on his part.

It does make sense that games will one day go digital only, it seems inevitable. But is now too soon for something like the PSP?"

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