An anonymous source close to Namco told PocketGamer that “the game is being finished up and it plays rather nicely”. Currently, the most valid hypothesis seems to be a port of Tekken 6 available for PSP but has not yet been confirmed.
With competitor Capcom having just announced Street Fighter IV for iPhone, Namco’s move with Tekken is a logical one. While Capcom will present Street Fighter IV for iPhone next week at Game Developers Conference, Namco made it clear that Tekken won’t be shown during GDC. Namco didn’t confirm or deny the existence of the game, they just said they don’t have any plans for Tekken next week.
We are NOT showing anything at GDC with regards to Tekken. We will be previewing new stuff, but it will NOT involve the Tekken brand whatsoever.