Things are not looking for Sony's handheld. After what appeared to be a successful resurrection with the redesigned PSP-2000, things have slowed down significantly for the system. EEDAR analyst Jesse Divnich noted that sales of PSP have dropped quite a bit from its previous highs. In fact, it sold 17% less systems in May 2008 as it did in May 2007. Momentum is significantly dropping.
The outlook for PSP is going to be much worse before it gets any better. According to Divnich, "this trend will likely continue, as we do not see any significant PSP titles in the short-term pipeline that could drive hardware sales in Sony's favor." The PSP software drought certainly isn't going to help.
For one reason or another, PSP software sales are also significantly lower than on any other platform. Divnich noted. "Furthermore, PSP software has consistently been last in software unit sales among the next-generation consoles and handhelds. Additionally, the PSP was the only console not to have a title in the top 10 of unit sales, even the PS2 managed to creep into the top ten with sales from Iron Man." So long as PSP software continues to flop, publishers and developers will have no need to create new content for the system.