While PlayStation Now will allow PS3 games to be played on the PS4, PS Vita and other devices, an inside source reveals that PS1 and PS2 games will be playable on the PS4 via emulation. Eurogamer’s source also reveals that the PS4 will be able to upscale these games to HD resolution.
The PS3 is already capable of playing certain PS1 and PS2 titles, while the PS Vita is able to play compatible PS1 and PSP titles using software emulation. The PS4’s powerful architecture will able to upscale games to native HD resolutions without the need to remake the games.
There’s nothing to say that these games won’t also be available onPlayStation Now, but there are advantages to using software emulation over streaming, like better image quality and less input latency. Like the PS3, it’s unlikely that you’ll be able to use disc based games, and you’ll have to purchase titles via the PlayStation Store.