Mk. 2 of portable handheld coming this year to threaten DS and PSP. No, really, we’re being serious.

The new, improved Gizmondo mk.2 console will definitely be on sale in Europe by Christmas.

That’s a promise by the CEO of the new owners of the handheld console, who has shown off the system for the first time to a lucky Swedish journalist (albeit without turning it on).

Mediapower boss Rich Jenkins said a deal with a  Chinese manufacturer was "negotiated and done” and that his company could ramp up production in future dependant on demand.

The design is very similar to the first Gizmondo (which came with a PAYG SIM from Vodafone in the UK to enable connected gameplay), but includes a newer version of nVidia's graphics chip and a new battery.

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The last iteration (pictured) launched in 2005, but had ceased production by February, 2006.

Owners of the old Gizmondo (apparently there were some) can even swap their old battery for a new one free of charge.

Jenkins said the price would probably be higher than the $99 the firm originally envisaged.

The system will come with a choice of two operating systems –Windows CE 6.0 or Google's new Android OS – and will be open, so any Window game or emulation can run on it.

Former CEO Carl Freer is involved in the new project.