An individual is claiming to have finally cracked the PS3’s formerly invincible copy protection system.
Although he claims to have cracked the hardware, he admits not yet having cracked the software, so a usable application is presumably some way off, if possible at all.
The cracker in question, identified as “geohot” (or George Hotz) and already well known for his previous exploits, explains:

I have read/write access to the entire system memory, and HV level access to the processor. In other words, I have hacked the PS3. The rest is just software. And reversing. I have a lot of reversing ahead of me, as I now have dumps of LV0 and LV1. I’ve also dumped the NAND without removing it or a modchip.
3 years, 2 months, 11 days…thats a pretty secure system
Took 5 weeks, 3 in Boston, 2 here, very simple hardware cleverly applied, and some not so simple software.
As far as the exploit goes, I’m not revealing it yet. The theory isn’t really patchable, but they can make implementations much harder. Also, for obvious reasons I can’t post dumps. I’m hoping to find the decryption keys and post them, but they may be embedded in hardware. Hopefully keys are setup like the iPhone’s KBAG.

The cracker was previously involved in “unlocking” the iPhone’s protection in 2007, so although any actual proof of his accomplishment is entirely lacking, he is at least relatively credible by way of former deeds.
Hopeful pirates (or “backup and homebrew enthusiasts” as the facile euphemism has it) have wasted no time in celebrating the possibility of finally getting free games on the PS3, though whether a usable modchip emerges from the hack remains to be seen, as does Sony’s response.

seems like its just a matter of time before the most secured console gets its firewall watered out ^^ rejoice!