Sony Ericsson appears to be working with parent company Sony to develop the rumoured PlayStation-branded phone.
The hint comes from Sony Ericsson CEO Bert Nordberg himself who told the Wall Street Journal.
"There's a lot of smoke, and I tell you there must be a fire somewhere." He added: "Sony has an extremely strong offering in the gaming market, and that's very interesting."
Nordberg said that the current generation of touchscreen smartphones is not optimised for gaming. He suggested that releasing a phone that makes full use of Sony’s gaming know-how could give his company an edge in the increasingly-crowded smartphone market.
"Sony is of course a very strong brand, and why shouldn't we use that?" he said. "Gaming, including content, is a very interesting proposition."
An unnamed source has told the Journal that Sony Ericsson’s planned gaming phone may run Google’s Android operating system, with the games available as apps.