Sony's NGP - the successor to the PSP scheduled for release later this year - is reported to have undergone a major specification revision, removing the on-board storage and dramatically reducing the amount of RAM on the non-3G model.
The cuts don't stop there either. Gone also is the planned 16GB internal storage, replaced by external memory cards to save on costs.
You should still expect fancy graphics, though, with the 128MB of GPU memory avoiding Sony's memory cull.
Remember that this is a rumour, but IndustryGamers notes that 01net has been known to get accurate Sony information in the past. What we're uncertain about is whether this specification change applies across the entire range of NGP models or just the basic non-3G device. The extra RAM supposedly still in high-end version of the device could be due to overheads outside of gaming.
All will hopefully be revealed in just over a week during Sony's E3 press conference.