PS3 may include PS2 hardware inside
Quick: how do you ensure that the PS3 is backwards compatible with PlayStation 2 games? It's easy: you just put a PS2 inside of it.
According to a Japanese periodical this is exactly what Sony has in mind for their back-compat strategy. Given that software emulation isn't an option (at least not yet), the PlayStation 3 is rumored to include the necessary hardware which is also used in the slim PS2. This would give one more reason as to why it looks so big.
Of course sticking that kind of power straight into the next-gen system would guarantee a big number of supported titles right out of the box. However, it also runs up the cost and bloats the overall system. We'll have to wait and see what happens with this one as we get closer to launch.
[Via Joystiq]
