The OS aside, the PlayStation Phone will come with a custom Sony Marketplace for purchasing and downloading games designed for the new platform. The device itself sports a 1GHz Qualcomm MSM8655, 512MB of RAM, 1GB of ROM, and a screen ranging from 3.7 to 4.1 inches. The handset also includes a long touchpad in the center which is apparently multitouch, as well as familiar PlayStation shoulder buttons. There's no Sony Memory Stick slot, but there is support for microSD cards.
The model pictured above is still in prototyping mode. Thus, there isn't a custom skin and the software is still rather buggy. In any case, a 2010 release is possible but 2011 is looking much more realistic. Can Sony Ericsson make the former possible or will it have to settle for the latter?