Flash memory maker M-System has recently announced a contract for providing storing solutions for the next generation X-Box. This, and the fact that Microsoft has also planned data storing abilities to Xbox Live, has raised speculations that the next Xbox would not feature a hard drive.
Jay Srivatsa, a senior analyst at research firm iSuppli, said the Xbox hard drive so far has been used mainly for ancillary functions like saving progress in a game, not to improve the way games work. Sacrificing the hard drive could be a relatively painless way to trim $10 or $20 per unit from production costs. "I can see why they'd attempt to do that--the hard disk usage on the current Xbox has been pretty minimal," he said. "At some point, this has got to be a profitable business for Microsoft. They have to draw some lines; look at what can they take out."Source: News.com