HD movie playback on TV
The current PSP allows you to play UMD movies or movies stored on a memory stick on your TV. Imagine the same feature, but in 720p/1080p via HDMI. The PSP 2 will be powerful enough to play back HD video files, so any movies you download from the digital store would then be watchable on the move or in the comfort of your home on your flash HD TV. We can't really get excited about playing near DVD quality UMD movies on our TV, but HD films is another matter entirely.

Download store
Sony is already laying the foundations for a digital download future by offering its first-party titles as downloads on the PlayStation Store. We expect this to be taken a step further by providing a downloadable version of every PSP 2 game, whether published by Sony or otherwise. Games and plenty of DLC will be backed up by a full movie and music download service, making your PSP 2 your hub for all your entertainment needs. You'll also see a large focus on smaller, bite-sized games as made popular by the iPhone, with throwaway slices of entertainment costing less than a bus fair. Think PSN or Xbox LIVE Arcade on an even smaller budget.

3G internet
Can you imagine what 'connect anywhere internet' would allow you to do with a PSP 2? Online gaming with the PSP is great, but it's limited to locations that have a wireless access point. With 3G you could connect anywhere (presumably by 2010/2011 the 3G network will be vastly superior), enabling you to play online games while on the bus, train or in the middle of a park - even while lounging on the beach in the summer. It's not just gaming either, with many more traditional PC like apps and the aforementioned store benefiting from this ability to be connected wherever you might be. Considering 3G usage is generally sold as part of a mobile phone contract, and we don't want the PSP 2 to also be a phone, we'd happily pay a monthly fee to use the service.