Finally got myself a PS3 a couple of months ago and here's my verdict:

Hardware

The machine itself is absolutely ace, a very well thought out piece of kit, it runs quietly all the menu's are well thought out and the Blu-Ray movies look very good when compared to normal DVD's on it. Speaking of DVD's, the upscaling is nowhere near as good as the 360's which can make DVD's look almost as good as Blu-Ray.

It can do slide shows, play music and play videos from usb memory sticks.

Sony seem to have tried their best to scam you out of your money once you have bought the console though as PS2 backwards compatability was remove rather infamously last year and there is no HD cable in the box so you have to fork out for a separate one at fifteen quid upwards.

Software

One word sums up this: none

There is a glut of games that are excellent but are also on the 360 with better versions such as Devil May Cry 4 which on the PS3 requires you to wait 20 minutes for you to install it, same with lost planet and there are also rumors that GTA 4 may need some installing before it can be played.

So far there are only 2 games that I can recommend and they are Ratchet and Clank: Tools of Destruction and Uncharted: Drakes Fortune, Ratchet and Clant has been done to death on the PS2 and if you have one I recommend playing it on that as the PS3 sequel is basically more levels with prettier graphics.

Uncharted is a different story, its a brand new game from the people who did the Jak and Daxter games, its a mix between Tomb Raider gameplay and Indianna Jones' humor and it is by far the best PS3 game out there right now. The graphics and sound are excellent as is the gameplay and story, but this one game does not justify purchasing a 300 pound console and I would recommend that you invest that money on a 360 elite with which you can get the similar Tomb Raider Aniversary and Tomb Raider Legend, both of which are not on the PS3 because of the removal of backwards compatability.

Also you cant get Gears of war, all the extra content for GTA 4, Halo 3, Crackdown, Mass Effect, Bioshock, Dead Rising, Saints Row and plenty more.