UMDs are 60-millimeter optical discs in protective cases that have a data storage capacity of 1.8GB. They were developed by Sony for use in the PSP, but plans already reach beyond gaming. Specifications for versions of UMD holding games, movies and music have all been drawn up. However, the only commercial UMD content currently on the market is the handful of games available for the PSP.Read more at Computerworld
Sony to allow other companies to use UMD format

Sony said it will start opening up its UMD (Universal Media Disc) optical disc format used in the PlayStation Portable (PSP), allowing other companies to build products based on the UMD system.