We have from a source at Sony, who shall remain nameless, that the next iteration of the PSP will not have an USB port. Sony's next PSP will be essentially the same as the current PSP 2000, with two major changes. One being no more USB Connection. Sony plans to adapt the same technology Apple uses for the iPod Shuffle, and sync via a dock that connects to the PSP via the headphone port.
The other is in place of where the current USB connection is on the PSP. Internally there will be built in flash memory. This is also based on Apple's iPod Shuffle technology. Sony plans to introduce two models, one having a 8GB and the other with 16gb. The next PSP WILL STILL have memory stick port for additional storage.