[Windows Phone 7 Q&A, Help & Troubleshooting] Jim Coleman:
Right, let me give my own perspective on this.

Until recently I was a WM6 user. I regularly upgraded my phone, and the last one was an HD2. WM phones never came with any real amount of storage, just a piffling amount of internal memory (what, 500MB?). I was therefore faced with the added cost and hassle of having to purchase a memory card and insert it into the phone. This was a bit like buying a PC without a hard disk and having to buy and install your own. It was an added hassle and expense.

Once you had your SD card inserted, you were then faced with the decision of where to store the data for each of your apps. Take email - do you store all your emails and attachments on the internal memory, thus using up a good chunk of that precious resource, but having it work quickly, or do you store it all on the SD card, where there's a lot more room but it's slow and clunky, and if anyone steals your phone they can pop the card out and get at the data? When you install apps, you're again given the choice of where to install it. Do you go for the speed of internal storage? Do you put it on the SD card, knowing if you ever pop out the card, your app will be unavailable? Decisions, decisions.... Too much damned complexity. The average user shouldn't be faced with these choices, if I install an app, it should just go on the phone wherever, period.

Not only that, once my card was in there, I never once removed it. The majority of my apps were on it, my emails, and all my media. I totally filled it with media. Popping out that card would more or less break my phone. My apps wouldn't work, my emails would be missing......so I never did. Nor did I ever use it as a mass storage drive....because there was never any free space on it. Instead I had a 32GB USB memory key hanging from my keychain - that was my portable mass storage solution.

Not only this, if I wanted to put media onto the card, I had to connect to the PC and drag and drop my stuff directly onto the phone. What a hassle! Doing this didn't optimize the size of the photos for the phone's screen. It didn't drop the bitrate of my mp3s, it didn't convert videos to the right size and format. All that had to be done manually, and I never bothered, so my media took up a lot more room than it had to. So inefficient.

So, given that I never removed the card, and that doing so would hose my phone, and that it was always full, so never got used as mass storage, and that it was insecure, and an added expense and hassle, and putting media on the card was a manual process, what would I have done in a next generation phone to cure all these issues?

Well, I would have made sure the phone came with plenty of onboard memory, and I would have removed the distinction between internal memory and the "card" so it was all one storage container. I would have secured the memory so even if it could be removed, the data couldn't be read in another device. I would have made sure the memory was fast enough to deal properly with a modern OS. I would automate the process of converting and downsizing media by using software on the PC to automatically perform those tasks. I'd also make the process wireless and fully automatic. I'd.......oh wait, that's what Microsoft already did in WP7.

So I'm happy, even if you lot ain't.