It is like a "patch" of sorts. It is used to update current hardware to either run a new feature such as PIP (picture in picture) on certain blu-ray releases, or something that might need to be implemented in the future. Its like an "update" if you will. It will come on certain games for the PS3 that were made after the firmware, but most of them you go to the manufacturers website and download it to a thunb drive or USB drive and then plug it into the hardware to update it.
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