A SVR4 mechanism for "standardizing" the installation of optional software. Most vendors are expected to use this format for distributing add-on software for Solaris 2.x.
Packages can be installed/deinstalled with pkgadd/pkgrm which are standard SVR4 items, or with swm (CRT) or swmtool (GUI-based) which are provided only in Solaris 2.
Note that the "pkg" system keeps lots of files in /var/sadm/install, and in particular the file "contents", which is hundreds of KB, and that there are two copies of it while pkgadd is running, so you needs lots of free space where /var is, typically the root. This file must be kept around if you want, for example, to use pkgrm to remove a package, or pkgchk to verify months later that all of a a package's files are still intact.
Summary of pkg* commands:
pkginfo <pkg> - test for presence of package. pkgadd -d /<cdrom>/Solaris_2.3 <pkg ...> - add missing packages pkgrm <pkg ...> - remove packages. pkgchk -q <pkg> - test for existence of package pkgchk <options> [pkg] - check installed packages for integrity.