via Kotaku
The sheer numbers of PS2 titles available, together with the increased complexity of using a software only solution for each and every title means that to ensure accurate software emulation for the majority would be technically challenging, time consuming and costly. As we have mentioned on several occasions, our engineering resources are now focused on developing new and innovative features and services for the PS3 and, as a result the 40GB model does not have backwards compatibility with PS2 titles.
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