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Z-Pack - PlayStation 3’s First Backup and ISO Loader?

The video above is said to be a live demonstration of a program called Z-Pack, which essentially backs up PS3 games onto what is most likely an external HDD (from the looks of it anyway) and also loads up the ISO files from the backup as well, allowing you to play your games without a disc.

I know the 360 already has a feature that allows you to back up entire games (though, I don’t have the space left for trying it, so I don’t know if its a basic backup where it stores data from a disc for faster loading or whether you won’t need the disc to play it). One thing is for sure, it’s something I’d like to do, but I would prefer something first party. If this turns out to be the real deal, and becomes available for purchase, would you consider buying it?

One thing I can see happening, though, is people who rent games, “back them up”, and return said games, but still technically own a copy of them. Will it also affect online play? Do the games have some sort of verification system that can read whether or not it’s a physical copy or a backup like some PC games do?