The update allows PlayStation 5 games to be stored on external drives. However, they can’t be played from there, and they won’t receive updates on external drives. Updates will apply automatically when the game is transferred back to internal storage, and you’ll have the option to choose which part of the game to transfer, such as a main campaign or a multiplayer mode.
Work on M.2 external drives that support the PlayStation 5’s SSD is still ongoing, Sony said.
Speaking of updates, the PS5 update enables pre-download for game updates and substantial patches, so games are playable as soon as the patch goes live.
Share Play is getting the cross-generation treatment. All the Share Play features work the same as usual, including share screen and letting friends try games, for both PS5 and PS4 players.
Some smaller enhancements include choosing when the system takes trophy screenshots, customization options for how game libraries display, and more options to control chat and voice settings.
The PlayStation App will be getting new updates in the next few weeks as well with updates to storage management and multiplayer options.
[Source: PlayStation Blog]
