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Whats backwards compatibility mean?
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It means that all previously made games for all previous generation PSX consoles would be playable on the PS3.
I'm not against a handheld from Xbox..but as for an all-in-one...remember the disaster that was the N'Gage? Yikes!
Frankly I'm into gaming in my living room on my comfy couch with my big TV and surround sound...so handhelds hold no draw for me personally.