I would say the planned features are software. Except, if you would need more Flash-Memory for additional programs like the mp3 decoder. Don't know how big a MP3 decoder was on my Zaurus (clamshell PDA). But even on my SimPad i had a lot of programs in the internal 32 MB Flash (including the OS!).
I would say maybe it isn't relying on hardware, other option would be, they either use small capacity flash now or could place additional modules in later hardware revisions.
diablo: ever seen how much a Sharp Zaurus is?
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