According to UK marketing magazine, Brand Republic, Sony is planning to turn its PSP handheld console into a challenger to the iPod with a music download service specifically for the PSP.

Sony Computer Entertainment Europe is expected to announce a download service for games and software updates for the new handheld at the launch of the device, however it is also expected that the company will roll out the service to include music and even video later in the year.

Sony currently has a music download service called Connect, however a poor user interface and music catalogue has held the service back compared to other services like iTunes and Napster. It is not yet known whether the service for the PSP will use the Connect service or be created entirely from scratch.

We will keep you posted.