The PSP has an active homebrew community, and hackers are hoping to create the same for the PS3. So far, PS3 firmware 1.10 and 1.11 have been cracked, making it possible to boot illegal game copies. However, hackers haven't figured out how to get the booted games to run so they can be played. What's Sony doing to stop this? Spokesman Dave Karraker says:

Unfortunately, hackers will try to exploit any hardware system software. The best we can do as a company is to make our security that much stronger and aggressively pursue legal action against anyone caught trying to use an exploit in an illegal manner... Naturally, any use of an exploit on the system software does void the warranty on the PS3 system... Which could be a costly mistake to see if you can run an old SEGA CD game on it.

If Sony's really serious about stopping this, it certainly needs to be more active than the steps taken against the PSP homebrew community. Firmware updates won't cut it. Brian Ashcraft

Making Threats [Eurogamer]