Sony whose business has struggled in the past because of a manic obsession with proprietary technology is now at it again with a new directive that will limit content being developed for the struggling PSP handheld device which has less than 12% of the Australian handheld market.

 New reports reveal that Sony is limiting content development for their new PSP minis in a way that could harm them compared to the way in which content is being developed for the Apple iPhone.

At a recent Game Developers Conference it was revealed that developers for the PSP which will only play content downloaded from the Internet are banned from using any networking features that link to their own sites. They have also said that developers can’t have additional downloadable content.

They also won’t be allowed to support third-party peripherals, according to the company.

Electronista claims that the decision is unusual as the company in its launch presentation compared the upcoming PSP minis to games for the Apple’s platform, where the small sizes and prices of most games attracted Sony to develop a new Portable Sony Player.

Apple iPhone and iPod touch games both support local network and Internet features, including downloading extra content from within the game, and can support third-party peripherals even if they require custom support.

Both the small downloadable games and the imminent PSP Go handheld are known to be at least part responses to the rise of Apple handhelds as gaming platforms.

Electronista further claimed that while Sony has had downloadable PSP games for some time, its insistence on putting these through a full approval process and pushing development of physical UMD games has meant far fewer games and much more expensive titles that often hover at $50 or $60 when new versus the normally sub-$9.95 to $12.95 price points in the Apple App Store.