A curious development on the handheld front: while PSP continues to lead the Nintendo DS in US sales, sales of UMD movies (the PSP’s movie format) have dropped so dramatically that most studios are now abandoning the format.

The PSP originally shipped with a UMD copy of Spider-Man 2. The shelves then became flooded with typical “guy” (or, “geek”) movies, like Texas Chainsaw Massacre, Bad Boys, Dark Crystal, and Kill Bill.  But now Universal, Paramount, Warner, Image Entertainment, and yes, Sony Home Video have either curtailed or abandoned production of the disc, and Wal-Mart has stopped selling them.

Sony, you may recall, was the same company who brought us Betamax in 1975 and the Mini Disc in 1992. Neither established dominance in the market, although Beta had an okay run in the early ’80s before it was abandoned for the lesser-quality VHS. UMD’s problem seems similar to what faced MiniDisc, namely that people don’t want to buy what they already have just so they can watch it (or listen to it) on a different machine.

And yet here Sony is starting to roll out yet another new format — the Blu-Ray disc, which they claim will replace DVDs in the near future. It’s VHS v. Beta all over again: this time, Sony will be competing with the new HD-DVD format.