When you select "Network Update" in the PSP menu, it will fetch the file
with the following URL from the web:
http://fj01.psp.update.playstation.org/update/jp/psp-updatelist.txt
This file currently has the following contents:
#JP Dest=00;ImageVersion=00000000;CDN=http://dj01.psp.update.playstation.org/update/jp/nodata;CDN_Timeout=30;
If an image with a higher version than what is currently installed is available, the PSP can download it from the URL specified after CDN= and install it. The upgrade image consists of a game file in the PBP format, which should reflash the system software when run.