Xbox 2--no hard drive? Latest hardware deal brings more doubt -------------------------------------------------------------------------------- posted 9:14am EST Thu Feb 26 2004 - submitted by Matthew NEWS More doubt as to the inclusion of a hard drive in the next generation of the Xbox was introduced yesterday when a deal for a new form of removable memory card was announced by M-Systems. The Israeli company manufactures flash memory cards, and released information regarding a deal with Microsoft to produce memory cards based on its Smart DiskOnKey technology for the Xbox 2. Specifics have been thin, but M-Systems stated that the size of the cards will be "significantly higher capacity than the 8 MB Xbox memory units Microsoft currently sells," and that what M-Systems will offer doesn't currently exist. Microsoft has also announced plans to allow storage of information for users on the Xbox Live network, and the ability to allow an Xbox console to be connected to a PC running Windows XP Media Center. Speculation is rife that the under-used hard drive in the current Xbox could be left out of Xbox 2, replaced by bigger memory cards and the use of a network and other devices for storage needs. This would also provide a cost-savings of around US$20 per console. Read more at CNET and the M-Systems press release. MATTHEW'S OPINION With Microsoft completely changing the architecture away from the x86 platform it wouldn't surprise me if it did away with the hard drive as well. It hasn't been utilized very well on the current Xbox, it adds a lot of weight to the console, and it's probably the device most prone to failure. Memory cards are a good profit maker for the console companies; Sony has demonstrated this by selling 8 MB memory modules at very high prices for a long time. If you don't have a hard drive then pretty much every console sale will be accompanied by a memory card. Microsoft knew that the original Xbox console was going to be a loss leader for its potential cash cow the Xbox 2 (or Xbox NEXT). I think this time round we are going to see a more traditional console that is very powerful, but at the same time something that will eventually become profitable like the PS2 hardware has. The only question now is what can we expect from the Xbox 2 memory cards? If you figure they will be priced similarly to the current PS2 memory cards then I think we will see something with up to 64 MB capacity, or even 128 MB. Anything more than that would seem like overkill, unless Microsoft has plans other than game saves and online play details. We'll have to wait until late next year to find out.