Adam Grant,PSP European Product Manager, SCEE explains more:
Lots of PSP games feature Ad Hoc Mode, which allows two or more players – each with a copy of the same title – to play together or share content via a wireless connection between their PSP systems. Before the introduction of adhocParty, players had to be in the same place, with their PSP systems no more than 10 metres apart, to enjoy Ad Hoc Mode. adhocParty changes that.
Now you can connect your PSP to another PSP system in another location using your PS3 as a server to bridge the geographical divide. This means that you can make the most of the Ad Hoc Mode functions in some of your favourite games even when none of your friends or fellow players are close by!
For further information head over to the PlayStation blog.