From PC magazine:
There's a lot to look forward to in the upcoming New Xbox Experience-- set to launch on November 19 -- but for those who own Xbox 360s without a hard drive or a 256MB memory card, you may have to go through a few headaches before you can download it.
Speaking to Xbox360Fanboy, Microsoft's Larry "Major Nelson" Hryb revealed that the full download size of the NXE will be 128MB, which will make it too large for a "small percentage" of 360 owners sans hard drive.
Major Nelson did, however, promise that a "storage solution" will be made available for these users... but refused to provide any details for now. His full comment follows:
"The new Xbox experience will require 128MB of free space. A hard drive is recommended for the optimal experience, to take advantage of some new features, and to be able to enjoy the great movies, TV shows and games available on Xbox LIVE. While we expect the majority of consumers to download the New Xbox Experience without a problem, a small percentage of Xbox 360 owners do not have enough memory to accommodate the update. To help ensure all Xbox LIVE members are able to download the New Xbox Experience and enjoy its new features, Microsoft will be offering storage solutions to the Xbox LIVE community. We are not sharing details of this offering yet. Be sure to check xbox.com for more details in the coming weeks."