Can your video iPod do this?

When we gave the Sony PSP an Editors' Choice last March, the award was as much for the device's future potential as for its capabilities at launch. Sure, the early lineup of games was lackluster (it's gotten a lot better recently), but there was little doubt that the PSP was the most powerful portable gaming machine on the market. It also had tremendous potential as a portable multimedia device, if only Sony could avoid crippling the device with the company's typical walled-garden approach to application and content development, not to mention its own software.

The bad news is that Sony continues to discourage so-called homebrew and even third-party commercial apps from making their way onto the PSP, with every firmware upgrade partially designed to beef up security and keep out party crashers. On the other hand, Sony is keeping its promise of improving the functionality of the device with its own software upgrades. In the six months since I wrote "Ten things I hate about the PSP" (and yes, I admit the title was sensationalistic), a few of my complaints have already come off the list. The most notable: Web browsing and the ability to customize the background screen have been added via firmware updates, and a real file-management software is now available--but the fact that Sony charges $20 to $25 for its just-released PSP Media Manager rather than making it a free download is a bitter pill to swallow. And now Sony's done us--or at least those that can afford it--one better. It's turned the PSP into a Wi-Fi TV--a pretty bold move for company that, until recently, has been overly obsessed with digital rights management issues.

Yes, that's right, with an upgrade to version 2.50 (or higher) of the firmware, your PSP will support Sony's version of the Slingbox, which the company has dubbed LocationFree TV. Like the Slingbox, the least expensive LocationFree system, the LF-PK1 LocationFree Player Pak ($350 list), is a simple base station, not much bigger than a cable modem, that you link up to your home network. The LF-PK1 then takes the output from virtually any A/V source--cable/satellite box, DVD player, or DVR--and broadcasts the images and sound wirelessly to a Windows laptop (sorry, no Macs) or a PSP. At home, you make a direct connection to the base station, which yields the best image quality. Outside, you go through whatever access point or Wi-Fi network you can tap into.

Remarkably, the thing actually works, and as I write this at the office, I'm watching a live feed of CNN on my PSP that's propped up next to my desk. The picture is quite watchable, though I've found that you have to keep the compression setting at a relatively high level. That translates into a lower number on the five-digit video-quality scale, with the middle 3 setting seeming to be the sweet spot for wireless streaming outside the home. That said, the setup wasn't as easy as the product's documentation claimed--the Slingbox setup was far easier--though to Sony's credit, it does include an instructional video. Also, I wasn't able to download the correct remote codes for my Scientific Atlantic 8300HD DVR, so I haven't been able to remotely control the DVR functions of the box as I can with a Slingbox. Small glitches aside, however, having the ability to stream my home cable system to the PSP is pretty killer, one of those tech game-changers, much like the ability to easily purchase and download episodes of Desperate Housewives and other video content to an iPod.

Presumably, Sony will improve the system with future firmware upgrades to both the PSP and the LF-PK1 base station (the latter needed an upgrade to version 2.0 to get it to work with the PSP). Still, I'd say the Slingbox--which costs $100 less than Sony's comparable device--is ahead of LocationFree TV in terms of interface, remote codes, ease of setup, and performance. Just how far ahead it is I'll flesh out soon in a full review of the LF-PK1.

The folks from Sling Media were in our offices a few weeks ago showing off a beta version of software that allows you to stream live TV via the Slingbox to 3G mobile phones and Wi-Fi-enabled Pocket PCs--apparently the aging Palm OS isn't conducive to streaming video wirelessly. Sling Media made clear that it would love to create a PSP version of its client software, but Sony--no surprise--hasn't been cooperative in helping the company develop it. Hypothetically, the company could offer a $30 version of its application for PSP owners to download onto a memory card, then kick a licensing fee back to Sony from each purchase. But at this point, Sony isn't too eager to let a competitor into this nascent and exciting "place-shifting" product space.

As I said, receiving streamed TV on your PSP, whether it's for watching in the TV-less recesses of your home or on the road, is pretty sweet. However, at least one coworker I've shown it to argue that its usefulness is diminished by the fact that it doesn't work unless you're in an area covered by an accessible Wi-Fi hot spot. They argue that a Treo-size smart phone with high-speed 3G data service would be a more enticing streaming-TV alternative, especially for commuters who ride trains or buses. Maybe, but that service still costs a fair amount at this point--around $75 for an all-you-can-eat voice and data package. On the flip side, at least you wouldn't have to pay extra for dubious video options such as Sprint's MobiTV or Verizon's V Cast, services that feature a limited selection of live-TV feeds.

The PSP, at least in its current version, will never have 3G-cellular capabilities. However, down the line, Sony certainly has big plans for the PSP and its beleaguered Connect downloadable music service. Sony won't comment on what exactly those plans are, but with iTunes adding video, it seems only a matter of time before Connect goes the same route. And while Sony may not have Desperate Housewives, it does have a little show called Seinfeld--not to mention the collective movie libraries of Columbia, Tri-Star, and MGM.

We'll see what happens. Right now, the iPod and its download-and-sync model lets you watch a small but likely growing number of TV shows wherever you want (at least, if you load up ahead of time), while the PSP lets you watch whatever you have access to at home, assuming you're within reach of a Wi-Fi hot spot. The portable-video revolution is just getting underway, and odds are still on Apple to get the whole video-download thing right before Sony does. But right now, when it comes to streaming live TV, the PSP has a leg up.