They are clearly able to emulate the games based on the PS1 and PS2 games being available on the digital storefront.
Edit: Thank you all for the informative replies.
In: Technology
Another major issue that you might not have considered is that CdS have a sampling rate of 44.1khz and blue ray have a sampling rate of 96 khz so not only would you need different lasers for reading you would also need different digitizing circuits and probably different filters for both. That would get very pricey very quickly.
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