Analyst Pachter: MS Should Release 200-500GB Hard Drive for 360

Yesterday we reported on a rumor suggesting that Microsoft has begun phasing out the 20GB 360 hard drive in favor of a larger 60GB edition. If word holds true, the product should be on the market sometime around the second quarter. Yet it seems that trusted industry analyst Michael Pachter believes that 60GBs isn’t nearly enough space with today’s expanding digital software market, and suggests a much different approach.

Said Pachter to, “I think the console [manufacturers] all misjudged the quantity of downloadable content and the opportunity to actually download meaningful content, and so what sounded like a good idea in 2003 or 2004 in the design stage with the 20GB hard drive on the 360 was just not sufficient.

Frankly, the surprise to me is that the new SKU is [purportedly] 60GB. I mean, I would think they’d introduce a 200GB or 500GB and eliminate the 20GB and make the 120GB the standard cheapie one. I think that more is better, although I don’t think most people will fill up their hard drive; but I think that as you feel you’re getting close you start to be less likely to download content.”

He went on, “These guys are doing a great job getting people to download levels and casual games, and even though those files are relatively small I think Microsoft would like Xbox 360 to turn into a whole media center and allow you to use your 360 as a DVR, and that would actually be a fairly compelling offering.”

By giving 360 owners the choice of a much larger storage device, Microsoft will essentially give the 360 a competitive media device advantage of Sony’s PlayStation 3. “And they have to respond to PS3 because that very much is becoming a media device with their winning the Blu-ray [vs. HD DVD] battle,” Pachter concluded.