It's not quite the 2.0 firmware rumored to be coming out soon, but this 1.8 firmware for the PlayStation 3 seems to have some nice features of its own too.
Among the sparklers are upscaling PS1, PS2 and DVD movies to 1080p, remote play on PSPs over the internet, and streaming of pictures, music, and video over the network from DLNA3 enabled devices. We haven't heard much about Digital Living Network Alliance before, but it's a bunch of companies that collaborated into making interoperability easier. We're not sure which products support this though. If Sony keeps up this line of fantastic firmware updates, the PS3 may actually be something worth buying by the middle of 2008!
Press Release [Sony]