When the PSN is working correctly, it's always worked better and faster for me and my friends than Xbox Live. In particular, my PS3 will pull 1MB/s (megabyte / sec) downloads at my university (6mb/s download connection). My roommates 360 would only pull about half of that. Of course, this isn't an exact measurement. I did have a watch along to compare, though...I wasn't just counting in my head.
As for having connection issues with individual games, I've not experienced anything that wasn't fixed by a patch in the game. Things have been pretty stable for me. Then again, I've gamed on PCs for a long while, and having different issues per game is common for me. And I do prefer the PSN as a service compared to PC gaming. PC gaming is free...PSN is still free. Sounds good to me.
I know a lot of people complain about the PSN being slow. I've experienced it before on my home Comcast connection, and it's a much faster connection than the one at my university. That said, I've posted fixes for that if it's really a big issue. You can either use the Privoxy program on your computer as a proxy server that your PS3 uses, or you can try a different modem. The Linksys CM100 did the trick for me. This fixed all of my PSN issues related to downloading speeds, including firmware updates, downloads from the store, and patches for games. Suddenly I'm not waiting 10-20 minutes for a firmware update. I'm not really waiting for anything anymore. Even my Wi-Fi speeds are quick. When no one else is using the network at home, I've seen the PSN pull downloading speeds of 3MB/s (again, megabyte/sec). I believe my parents pay for 10mbps/1mbps, though Powerboost puts that around 20/3.
I'm not sure what causes this. I'm not sure if Sony/PSN is messed up, if it's something with most people's networking, or if it's the majority of ISPs. As I've said before, the PSN has always been super quick when we had Insight as our ISP. When Comcast bought them out, the PSN turned to crap. This was on the exact same networking setup in my house. Just an ISP change. I really don't know what causes it, as it works just fine at my university as well.
For all of you complaining about how the PSN is slower than XBL, I've posted fixes. I agree that you shouldn't have to do it for a better PSN connection, and it won't fix everyone's issues (most, though). However, the fixes are easy. One requires 5 minutes of your time setting up Privoxy. When gaming on PSN, you need that computer on with the program running for the fix to work (and to stay connected). Yes, this might be inconvenient for some. The other is just trying out a different modem. As I said, you shouldn't have to...but it's really not difficult or time consuming. I see a lot of people complaining about how slow the PSN is. Well, if it's really THAT big of an issue, take the time to try these out of you haven't. I'm even going to post a link to the thread I created about it a year ago:
http://forums.anandtech.com/showthread.php?t=273816