Wikipedia
MagicGate
MagicGate is a copy-protection technology introduced by Sony in 1999 as part of the Secure Digital Music Initiative (SDMI). It works by encrypting the content on the device and using MagicGate chips in both the storage device and the reader to enforce control over how files are copied.
MagicGate encryption is used in the memory cards of the PlayStation 2 and, , has been introduced into all of Sony's Memory Stick products. Some devices, such as Sony's Network Walkman, will only accept Memory Sticks which use MagicGate technology.
All Memory Stick Duo cards equipped with MagicGate can be identified by a notch located on the rear end of the card.