"It's only been two days since we reported on those PSP 2 rumors and already a Sony exec has made our rumor official by confirming the company's plans to make a PSP2. Sony Computer Entertainment UK managing director Ray Maguire was quoted as saying the new PSP will be more pocket-friendly, thanks to a smaller and lighter design. Maguire also said the PSP2 will have the same screen size as the current PSP. So we're basically looking at a PSP Lite. No word on when it'll launch, though we here at Giz are wondering if Sony will plan on actually making games for the new PSP."
I will be interested in seeing how much smaller they can really make it while still keeping the screen size. Other than being thinner (which won't improve its pocketability much), I don't see much else they could cut.