Necessary, but way too expensive
If you want to play a game more than once, you really need one of these memory cards to save settings and scores. Unfortunately, they are a rip-off and you can't use PlayStation 1 memory, either. Why not allow Compact Flash or Sony's own MemoryStick technology? I don't know what "MagicGate authentication and encryption" means, so maybe that's buying you something, but I'm a software developer who worked for an online gaming service, and it doesn't mean a thing to me. I'd also think that the PlayStation hardware would do whatever encryption and authentication is necessary, not some memory card.
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