In a recent chat with CVG, Bourne Conspiracy lead designer Rory McGuire flat out said that Microsoft made a "mistake" with their decision to not make a hard drive mandatory in all Xbox 360 models. McGuire told CVG that "in retrospect I wish Microsoft had made the choice to have [mandatory] hard drives like Sony did with the PS3." McGuire further went on to explain the development advantages of having a HDD saying that "if you have a hard drive, the whole game loads faster. Obviously you'll be facing a short install time, but the developer benefits from it and you definitely benefit from it as a player." Take that Microsoft!
On second analysis, it's entirely possible that Microsoft could make HDDs mandatory in all Xbox 360 consoles by axing the Arcade and taking out another $1.9 billion hit to ship 20GB HDDs to Core and Arcade owners. Makes sense to us.
Falling under the category of "all 360 rumors are true," GameSpot has, um, spotted further evidence of the impending arrival of the Xbox 360 Arcade console. It seems an unknown retailer is already displaying a store advertisement describing the Xbox 360 Arcade and all its marvelous features. The ad reconfirms everything we've 
