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No Xbox One external storage at launch

Coming straight from the lips of Microsoft's director of programming for Xbox Live, Lawrence “Larry” Hryb, AKA, Major Nelson, we now know that the Xbox One will not support external storage, though it's been said that it will at some point in the future.
“The future plan is for definitely to support external storage much like we do on the Xbox 360,” said Major Nelson on the latest episode of his podcast.

“My understanding is that feature will not be there at launch because the team is working on some other things, but it definitely is on the list. I don’t know when it will come in though.”

xboxone

While you won't be able to hook up an external drive – something that's basically a necessity on the Wii U – the Xbox One will come packing a 500GB internal drive. This is hardly huge by contemporary PC standards, but it's quite a step up over the Xbox 360's initial 20GB offering. The only downside there is that we know you can't replace it if you do want more.

Microsoft will also be offering cloud storage, though that's not much comfort to people with poor upload rates.

KitGuru Says: Considering the PS4 will let you swap out the HDD to whatever you want (potentially an SSD if you have the money) this could be quite a decent selling point for Sony and another bug bear for Microsoft's PR department. In the interest of fairness though, Sony isn't allowing installation of games to its external storage, even if it is offering it. 

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