All I/O operations are delegated to another chunky chip called Southbridge . This is very similar to the architecture the original Xbox adopted back in the day. It seems as if the architectural gap between consoles is becoming narrower, or maybe this approach proved very reliable and it's architecture-agnostic, I'll let you decide.

The big Southbridge chip supervising small I/O chips and interfaces.

The same picture with important parts labelled.
Like the PS2's IOP, the Southbridge is completely proprietary, though this time made by Toshiba (they called it the 'Super Companion Chip' ). So, while it still remains an obscure piece of silicon, it does a superior job consolidating many interfaces and protocols, both external (i.e. USB, Ethernet, etc) and internal (i.e. SATA). For reference, in the past, the IOP's slow clock speed ended up bottlenecking speedy interfaces like ATA and Ethernet, greatly reducing their full bandwidth.
Furthermore, the southbridge implements encryption algorithms to protect the communication between standard protocols in a seamless way, such as the Hard Drive data.

Diagram of the Southbridge's connections.
Overall, Southbridge embeds an enormous amount of interfaces, this has to do with the fact this console was designed during the 'multimedia hub' trend. It's not enough for video game consoles to play games, but they also need to become DVD and Blu-ray players, set-top boxes (partially), photo viewers (by importing the camera's photos using the multi-card reader) and possibly more as the needs evolve (thanks to its updatable operating system).
External interfaces

Like many PC towers of that era (including mine), a multi-card reader was in order. Next to it, you get four USB 2.0 ports.
This was pretty 'premium' for a console costing £425!

Same console with the lid closed.
To further cut the cost down, later models sealed the bay and removed the card reader and two USB ports.
In the case of user-accessible ports, the Southbridge is connected to:
- A USB 2.0 hub: provides four front USB A ports. These can be used for accessories or to link/charge the controllers.
- A Serial ATA (SATA) interface: connects the Blu-ray drive and a 2.5" Hard Disk.
- Until 2008, Blu-ray readers interfaced with Parallel ATA , so an intermediate chip was fitted in the middle to do the SATA -> PATA conversion.
- 1000/100/10 (Gigabit) Ethernet Controller: in the form of an RJ45 socket on the back, but it also forks to a Wireless daughterboard, providing Wi-Fi 802.11b/g and Bluetooth 2.0 connection.
- A Multi-card reader: provides slots for Memory Stick, SD, MultiMediaCard (MMC), Microdrive and Compact Flash.
'Less wire' equipment
Thanks to wide the adoption of Bluetooth technology, wired controls are now a thing of the past. The new form of the PS2's Dualshock 2 controller is called Sixaxis and while it's not the radical change others decided to go for, it features a gyroscope for new types of human input. This comes at the expense of the haptic feedback (Rumble), however. A year later, Sony surprised players with the Dualshock 3, which restored the haptic motor.
On a different topic, you can now turn on the console from the wireless controller.
Internal interfaces
Regarding internal components, SouthBridge connects to:
- Starship 2: an adapter for two 128 MB NAND Flash chips. Behind the scenes, Starship bridges the Southbridge's local bus with the standardised 'Common Flash Interface Protocol' (widely adopted for interfacing Flash memory) . The PS3 stores the operating system on these, among other things.
- The PlayStation 2 chipset: at the corner of the motherboard there's an eye-catching chip that houses none other than the Emotion Engine and the Graphics Synthesizer. The EE+GS combo connects to 32 MB of RDRAM and an IO bridge (named 'PS2 bridge'), which combined form roughly 90% of the original PlayStation 2.
- The EE+GS chip sends the video signal directly to the RSX.
- These chips are not accessible by developers, they are used for backwards compatibility only!
Backwards compatibility
Having mentioned the PS2 chips, I guess this is my cue to talk about backwards compatibility of the PlayStation 3 once and for all.
First things first, let me introduce how backwards compatibility generally works: consoles can either play their predecessor's games with the help of software (instructs existing hardware to behave as the old game would expect) and hardware (either the existing hardware provides total or partial backwards compatibility; and/or the company added extra chips to recreate the older system within the new motherboard). With the amount of processing power the PS3 shows, you would expect Sony to ship a PS2 emulator running within Cell and accelerated by RSX. Well, for some reason that didn't happen and instead, Sony fitted the PS2's chipset at one corner of the motherboard.

The big EE+GS chip, two 16 MB RDRAM modules and the 'PS2 bridge'.

The same picture with important parts labelled.
On the other side, the missing but not-as-critical chips (IOP, SPU, etc) are replicated with software running in Cell. In the case of game saves, initially, users had to acquire a memory card adaptor, but once a new software update landed, Memory Cards are now emulated as disk images stored in the hard disk, while Magic Gate (the encryption system) is handled seamlessly by one SPU.
Since the Cell and RSX are still 'on' while playing a PS2 game, the system offers two scaling methods for increasing the screen area during gameplay, these are 'nearest neighbour' or 'smoothed' (anti-aliased).

PS3's user interface showing the game entry after inserting a PS2 disc.
(Don't worry about the other icons for now, as some are not even official).
All in all, thanks to this setup, the PS3 runs PS2 games at an impressive compatibility rate. On top of all that, you can take advantage of new features that come with the new console (wireless control, HDMI interface and virtual memory cards).
As if that wasn't enough, PS1 games can run as well, this time without needing to embed the old SoC or GPU (it relies on pure software emulation).
The strange end of terms
Throughout the lifecycle of the PS3, Sony slowly trimmed PS2-only chips from the PS3 motherboard to the point backwards compatibility was solely software-emulated (with greater limitations, such as only running PS2 games purchased from their online store). Because Sony never replaced the PS2 chipset (as it had previously done with the PS1 hardware inside the PS2), it makes you wonder about the technical and executive rationale behind this. Well, as a case study, here's my quick opinion about the reasons for this:
- Timing: Sony likely intended PS2 owners to buy their new product as a replacement of their current one, as this is more affordable for consumers (they can sell their old system). However, for some reason, Sony didn't have a software emulator prepared before release day, so they initially resorted to adding extra chips. Later on, as the software emulation progressed satisfactorily, they slowly removed these in further motherboard revisions.
- To complement this, developer 'M4j0r' commented: "An interesting point might be that Sony developed the two hardware emulation revisions at the same time (EE/GS and GS only), I guess because some games run better depending on which you use." .
- Costs: The introductory price of the first revision of the console (CECHA, only in Japan and US) in 2006, which was PS2-compatible, was priced at $599.99 or ¥60,000 without taxes . The following model (CECHC, shipped in 2007 internationally) removed the Emotion Engine and RDRAM (shifting those tasks to software emulation) and launched in the UK with a £425 price tag. Later in the same year, Sony released a new model (CECHG) without any PS2-related chip for £126 less . All this proves that backwards compatibility is, in the end, an expensive add-on.
- Idling hardware and wasted power: While Cell and RSX still take care of some tasks to recreate the original environment, these are minimal compared to their full potential. Combined with the fact CECHA models have a cumulative power consumption of 399 Watts , it does make you wonder if this design is worth the power consumption, let alone efficient (for comparison, CECHG's new power supply consumes 285 Watts).
- I understand there are other factors involved in the reduction of power consumption, like the new revisions of Cell and RSX. However, I still believe the PS2's chipset plays an important role.
- Inflexibility: The EE+GS chip is not re-programmable, which means the end result will always be the same, independently whether there are glitches or possible enhancements. Compare this to the PCSX2 emulator's graphic enhancements and its modding capabilities , this shows us that room for improvement is possible and appreciated.
Personally, I believe pure software emulation is the most feasible option in the long term due to its scalability, customisation, and independence from proprietary hardware. But of course, this takes more effort to implement accurately, as the ongoing development of PCSX2 by a volunteer-driven community demonstrates it (please note that the aforementioned emulator only runs on x86 PCs, however).
Lateral compatibility
We are not over talking about compatibility just yet! It may surprise you that Sony also allowed users to run a subset of PlayStation Portable games as well. Though emulation was carried out completely with software, just like the PS2 compatibility in later models.
As there isn't any UMD disc reader in the PS3, users must access a game catalogue from Sony's online store to download and install any PSP game.