Don't take my word for it, take consumer reports.
"Less satisfying was the PS3's less than optimal HD picture quality when connected using its component-video output, which produced images that lacked the detail and clarity we've seen with other high-definition DVD players connected using their component-video output. That's not much of a concern if your TV has an HDMI input, but if your TV is more than a year or two old, it might not have it. In that case, you'd have to use the component-video for high-def content, and you'd be stuck with middling HD picture quality."
"Less satisfying was the PS3's less than optimal HD picture quality when connected using its component-video output, which produced images that lacked the detail and clarity we've seen with other high-definition DVD players connected using their component-video output. That's not much of a concern if your TV has an HDMI input, but if your TV is more than a year or two old, it might not have it. In that case, you'd have to use the component-video for high-def content, and you'd be stuck with middling HD picture quality."