You have to pay for your games again :(
I think the thing that will keep more people that have supported the PSP for years from upgrading to the PS Vita will be the fact that you can't use the UMDs already owned in the Vita. Sony has detailed the UMD Passport program for PS Vita users to migrate their UMD games over.
If you were hoping that the program would make a digital version for you free so you can keep playing your library titles, you are out of luck. The UMD passport programs requires a PSN account. The software can be downloaded and then you put in your UMD and the software will register it on the PSN.
Once your UMD games are registered, the games will then be offered to the Vita user for a discounted price in digital format. Yes, that means you have to pay again to get the games you already own on the Vita. I guess Sony didn't learn much from the fail of the PSP Go that did much the same for UMD game owners.