PKG games is a popular way to save storage and bandwidth, but it requires specific tools and a modified console to work correctly. PKG (package) files are a standard format for digital PlayStation content, and when compressed, they are typically stored in archives like .zip or .rar to reduce initial download sizes.
But on the floor, where the game console used to sit, was a single, shining USB stick. On its side, etched by no hand anyone could see, was a tiny label:
A file is Sony’s official digital distribution format. On a modified PS3, these files function like installers (similar to .exe or .zip files on a PC) that extract game data directly to the internal hard drive. The "Highly Compressed" Aspect
This is the most important section. unless you own a physical copy of the game and are downloading a backup for personal use.