http://pspupdates.qj.net/Unshackled-PSP-firmware-3-50-allows-official-games-to-hit-333MHz/pg/49/aid/95634

More power to portable gaming. We've just picked up word via an insider that among the updates that PSP firmware 3.50 carries, one important feature that's apparently been unlisted is that this latest fw release will finally allow commercial games to run at the PSP's full 333mhz CPU speed.

Prior to this, all UMD games for the PSP have been restricted to just 266 MHz - roughly 80% of the portable console's full power.

 And while homebrew applications (that means you, intrepid coders!) have already been unlocking this feature for some time now, this move will provide new-found benefits for official UMD games: accelerated frame rates and game load timesare definitely at the top of our wish list, although we'll just have to wait and see if this is indeed the case. Aside from the hopeful speed boost, we're just hoping Sony's also got something planned for the increased power usage expected from turning the proverbial limiter off on the PSP- do we see a new battery in the works?

That aside, the company has yet to give an official statement on this new feature, and whether this unlocked CPU speed is dedicated to post-3.50 UMD games, or will affect past titles as well. Stay tuned for updates on this hot news.

Good news for future PSP games. 

Cool, thanks for the tip.

How does it affect battery life?

Well ... it'll be bumping the processor up 67MHz which is a little less than 30% increase. My guess is, it'll drain the battery a bit quicker than normal when playing newer games that require the higher MHz. It shouldn't have an affect on games that only require 266 or less. Perhaps this announcement is further proof that a Slimline PSP will be arriving soon.

333... MHz.... Isn't that... More than PS2?! And that for a handheld FCS...

Now i know why GoW: Chains of olympus was lookin so goowd .... Good news for PSP owners/future owners...

Cause now there's a handheld that's (in theory) more powerfull than PS2...

Why was the 266Mhz restriction put on in the first place? Anyone know?

The new FF: Crisis Core screens confirm to me that the game is making use of this new feature already...

 That's due to shading abilities built into the GPU, not anything with the CPU. The CPU can't handle most of the shading, since it only has one vector unit, unlike the PS2.

 Then again, the PSP has to use hardware rendering, or else the battery life would drain super fast.

 Plus, as he stated, the main effect of the increased clock is framerate.

 As for loading times, which is also mentioned, I highly recommend they rip-off the GC's use of ARAM as a disc buffer. That allowed the GC to load faster than the PS2 and Xbox, even though it had the slowest drive speed (2x-3x compared to the PS2's 4x and the Xbox's 6x). That would be a great way to increase the battery life even more.

so sony has actually not shown the true potential graphicly on the psp? FF:crises core looks like a ps2 game it looks good I couldnt believe it when I saw it.

I have no source but when the PSP was released it was suggested that this restriction was put in place to ensure that the PSP had a long battery life. This could be a sign that they overestimated the battery drain, they don't care about the battery life, or a new version is going to come out and this is not an issue on the new version.