We often talk about attempts to dethrone the immensely popular iPhone and it looks like consumer electronics giant Sony is about to take a stab at it next.

Sony has released word that it is considering setting up a project team as early as July to make a new device that combines the functions of its portable gaming device (the PSP) with mobile phone features.

An increasing number of game developers including Capcom and Square Enix are now launching software on the iPhone to take advantage of the popularity of Apple's platform, posing a growing threat to Sony's PlayStation Portable and Nintendo's DS portable gaming consoles. This is forcing the video game console producers into considering joining the cellular phone fray, as apparently a dedicated video game portable player simply isn't enough to compete these days.

Specs and pricing on the Sony's converged handset have yet to be finalized.