Originally Posted by IGN

NETWORK - Internet Browser - The biggie of the bunch, a new browser function has been added to the PSP so that you can connect to a website any time you are in the area of a compatible / accessible WiFi hotspot. The browser supports standard 4.01 HTML, but will not support Flash (although it is listed what sounds to be a sniffer function for Flash to show when it is requested but not available ... might it be part of the PSP brower someday?)

NETWORK - New Network Menu - This is where the web browser will be housed. The icon for it will be a globe, and it'll cycle in with the music note, film frame, and game logos

VIDEO - Performance Jump in UMD Video/Music - We have no idea what the specifics of that are, but we like the sound of it

VIDEO - A-B Repeat Mode - A handy feature for watching clips you like, this feature allows UMD Video, Music or Memory Stick videos to repeat your favorite scenes

VIDEO - 4x3 Video Mode - We're not sure what this accomplishes, as videos were already 4x3.

VIDEO - Audio Performance Change - Again, no details, but that sounds spiffy.

VIDEO - MP4 (AVC) Playback - This is the good stuff. Homemade PSP videos have so far been hobbled by limited codec implementation and an adherence to a regulated Memory Stick standard. Instead, the PSP is finally allowed to branch out and play more complex, high-quality, full-screen video in the advanced h.264 codec. Exact implementation of the AVC codec may still depend on certain variables, but get your compressors ready.

MUSIC - ATRAC3plus Support on PRO Duo - Correcting a silly technical gaff in the Memory Stick format, music fans can now put ATRAC3plus files on their PSPs. (SonicStage v3.2 software is required.)

MP4 AAC & WAVE Support - The PSP can now play MP4 audio (MP4's AAC format) as well as Linear PCM WAVE files.

PHOTO - Wallpaper Feature - We're guessing this is the much-requested feature for taking your favorite pictures and smacking them in the background of the PSP menu. There's no mention of a randomizer or anything else that would make this feature even more cool, but at last, something other than that swishy swirl on this month's color.

PHOTO - Picture Sending - You can now trade photos with other PSP owners over an ad-hoc (local) wireless connection

PHOTO - New Formats - The PSP can now read TIFF, GIF (we're not sure about animated GIF yet) and BMP files.

SETTING - Korean Language - A new language option on the menu. That'll be nice for them

SETTING - New Character Set - No details available on this.

SETTING - Theme Setting - No details.

SETTING - Internet Browser Restriction Setting - A set of options for configuring the access your PSP has to the net, presumably your cookie and personal security handling.

SETTING - WPA Support - If WEP isn't secure enough for your home, you can now access PSP with WPA-PSK (TKIP.)

SETTING - Web Support on Keyboard - It's unfortunately not as cool as it sounds (we were hoping for USB keyboard support to be added, as there are a couple of USB manufacturers with mini-keyboards on deck.) The old dial-a-letter keyboard will be the input for the web browser.

Originally Posted by IGN

Sony knows that a the PSP is all about looking pretty, and this videos made for a downright fugly system at times. Enter PSP Version 2.00, the newest and most fully-featured update to the PSP bios. One of the big new features in this update is full support for the advanced h.264 codec on videos from a Memory Stick. Known as AVC, this compression format is what is used to make UMD Video releases look DVD-quality on the small screen, and although home users likely won't have the tools or skills to make video of that quality (we're not entirely sure yet if homemade movies will be able to be produced, although there's no indication that we won't have access), the full support of this codec should go a long ways towards fixing a glaring flaw in the PSP's multimedia feature set.