The handheld’s 3G service in Japan will be provided by NTT DoCoMo.
Gamers will be able to use the 3G connection to play online games and download software and movies.
The system will feature wireless LAN support.
The paper also reports that the new console will make use of an OLED touch screen. Sony has developed a new processor for handling high resolution visuals.
Pricing on the next generation PSP is currently TBA, according to Nikkei.
The console is yet to be announced by Sony, but it’s expected that the company will unveil the device at a press conference in Tokyo on January 27.
A PlayStation branded phone, which has had its form factor and features splattered all over the internet in recent months, is reported to be heading for a Mobile World Congress reveal in February.