Now software wise is a different matter, you could say piracy killed the appz but were they good enough for people to buy to begin with? Maybe it was just ahead of its time trying to bring console gaming to a handheld and because of that the developers made games that weren't really good or geared towards the handheld gaming market. Cheaper/smaller games for the likely lower sales (don't expect console level sales from handheld games)
What does the ipod touch do that the psp doesn't and vice versa? Why shouldnt it be priced the same when its a similar piece of technology? My take on the pricing is that they are taking the psp as ultra portable for a new demographic, the type of person who buys a ipod touch or bb and similar electronics. They could well make it come cheaper and with a subscription service/contract for game downloads similar to the service contracts those expensive phones have with cell companies.
You mean PSP was dead till it got hacked. The massive number of psps sold is mainly because it was so easy for people to do what they wanted to with it. Since the launch of the PSP I was hearing that it was lame and i am pretty sure most people only buy the psp because it is hacked. Otherwise it would be a complete failure.