If the Wall Street Journal is right, Sony is developing two products to rival Apple’s iPhone and iPad respectively.

According to the Journal’s source at Sony, the smart phone will be able to download and play PSP games while the iPad rival “blurs distinctions among a netbook, an e-reader and a PSP.”

Both the phone and the “multifunction device” are expected to be compatible with Sony’s online media network launching later this month – itself a rival to iTunes. The network will host movies, TV shows and music. Compatible devices will be able to access PSOne games.

The products are a part of Sony CEO Howard Stringer’s strategy to create devices capable of accessing online networks and games.

“That’s the vision, but it’s still not quite clear what specific steps Sony will take to achieve that, especially when iPad and other highly capable mobile devices are crowding the market,” said Nobuo Kurahashi, consumer-electronics analyst with Mizuho Investors Securities.

The new products are expected to be released this year. Neither prices nor specifications have been determined.