Whoa! A PlayStation TV. It's a $500 24-inch 3D TV that Sony's promising delivers "best in class" entertainment for way more people than are able to currently afford 3D. It looks like a giant PSP, sorta. Update: Hands on.
It's, well, nice. Set up in the fake, entirely-too-clean dorm room Sony had on hand, the chair practically smashed against the set—which is exactly how I played videogames in my dorm, the screen foggy from my breath—the 24-inch set didn't seem too small. So it's perfect for exactly the scenarios Sony's talking about, not so much a living room deal.
It's hard to gauge how amazing (or not) the picture really is in this environment, but when you cram a 1080p display into 24 inches, the pixel density definitely works for the screen. The PlayStation display's signature trick—re-appropriating the inherent powers of 3DTVs to show each player an entirely different 1080p image—works exactly as advertised, as you can see in the video. You switch between first and second player by pressing a button on top of the glasses, and the switch happens instantly. (Unfortunately, this means screen-watching isn't quite dead, since you can just flip over to your friend's video feed to see what they're up to, and quickly switch back.)