PS3 is The amazing device by sony but it has some common problems like sound
problem, video problem etc.... Good news is that these all problems can be
repaired with the help of DIY Guides, one' such guide available at PS3 Repair Blog.
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I am 100% sure that this is the laser your ps3 has two different lasers one is red for regular movies videos or music and one blue for games and bluray movies try to play a blueray movie and if it don't play or plays for few minutes and then freez is more likely your laser it can be replace just look for you ps3 model and buy one for your ps3 model not all ps3's use the same laser there is like 3 diferent lasers
Ok so its 60GB its definatly alright to play movies and all sorts, but if you are that desperate to watch movies then you may want to reset to factory settings just access settings and look for reset console, then it would start from square 1 you have to make your accounts and earn your trophies again but if you want to watch movies desperatly then recommed you do that or go to game settings in the game column and have a poke in the folders because there might be a few things in there or go to the film column and check for setting sin there or go to the settings column and check for film settings in there its nothing to do with the updates thats for sure because ive done the same as you but havent played the game in a while but im still able to watch films
the bluray laser is bad. The PS3 has two lasers – one to read
bluray, another to read DVDs. Games are in the bluray format… as well
as your… well, bluray movies.
Or, this might be the issue.
If your PS3 is under warranty, send it in for repair. Describe the
issue, and they will give you an RMA. I once had my PS3 repaired and
back to me within the week.
First try putting the movie you watched when this happened, back into the PS3, see if you are able to watch this movie and if it reads this particular disk... if it will, contact the company and tell them that your PS3 isn't reading any of the disks, they will send you a box and repair your PS3 free of charge and send it back to you in about 3 weeks.