According to a post on the Devsgen PSP forums, Sony has included an official ISO loader in PSP Firmware versions 3.50 and 3.51. The loader is called np9660.prx and will apparently let PSP users load ISO files off their memory sticks. Once again, this feature wasn’t mentioned in the official change log, but it could be because Sony is planning to allow ISO downloads in the future.
Sony could be planning to release downloadable PSP titles either through PSN or a similar service geared exclusively for the PSP. The company has already mentioned earlier this year that a download service for the PSP is in the works.
French PSP news site PSP-Generation also notes that Dark_AleX and Mathieulh will be patching the np9660.prx file for use in Custom Firmware 3.51 OE.