By Daniel Emery
BBC technology reporter, Los Angeles
Sony's games console head, Kaz Hirai, demonstrates the new PSP Go
Sony has unveiled its new handheld gaming device, the PSP Go, at the E3 video games conference in Los Angeles.
Video and photos of the PSP Go were leaked online before the official announcement, revealing a lighter, slimmer console.
"We call it the worst-kept secret of E3," said Sony Computer Entertainment chief, Kazuo Hirai, at the launch.
The new handheld is seen by many as a direct rival to Nintendo's DSi, which went on sale in April this year.
Speaking to the BBC, Mr Hirai said they had got "a good buzz" from the launch and did not think the leaks had done any harm.
"Once information leaks out, it goes out like wildfire, but everyone got really excited by the possibilities," he said.
Sony says the PSP Go will go on sale in October and cost 249 (£214) in Europe and $249 (£149) in North America.
Games content for the PSP is an area lacking in terms of third party support
Piers Harding-Rolls Senior analyst, Screen Digest
"The price was a bit of a shock, especially given the current economic climate," Piers Harding-Rolls, senior analyst with Screen Digest, told the BBC.
"I would say it is a challenge to the potential of the platform, but also reflects the internal climate Sony faces," he said.
The news of PSP Go was already widely known after an official video showcasing the new device was mistakenly posted to a Sony website before being hurriedly pulled prior to the official launch.
In the video, Sony's John Koller gave an accurate breakdown of the devices capabilities.
"It's a 3.8-inch screen, it's 43% lighter than the PSP-3000, 16 gigs flash memory, Bluetooth support and all digital content so the UMD drive goes away," he said.
Sony also announced a number of new games at the event for both PSP and PS3, including Little Big Planet, Motorstorm, Metal Gear Solid, God of War III, and Final Fantasy XIV.
The firm also said that it was reducing by 80% the cost of PSP developer kits - the tools external companies require before they can produce software that will work on the PSP operating system - to encourage third party developers to produce more games for the handheld device.
The new system will not replace the PlayStation Portable
"Games content for the PSP is an area lacking in terms of third party support, and arguably first party support, although that appears to be changing," said Mr Harding-Rolls.
Sony executive Kazuo Hirai said that, for now, the company would not be giving the toolkits away for free.
"[The toolkit] is part of the ecosystem we create for the development community. But we like to think it's part of the business model we have in place," he said.
Sony stressed that all of the games available for the PSP Go would be available for direct download.
Mr Harding-Rolls said Sony was developing a different approach to the marketing and purchase of games: "It underlines Sony's more aggressive and experimental approach to digital distribution opportunities."
"The fact Sony went out of its way to reiterate where the PSP is going - the differences from other handhelds, third party content, digital distribution - just highlights the fact that it is a unique device and a solid commercial opportunity in its own right," he said.
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