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Halo: Reach co-op requires hard drive, 4GB Xbox 360 Slims have to go solo [update: MS responds]

Bad news for some of you who wanted to Remember Reach with some of your closest pals: Halo Reach's excellent co-op functionality requires an Xbox 360 hard drive. While that's unfortunate for all non-hard drive owning Xbox 360 gamers, it's especially worrisome for those of you who recently jumped into a 4GB Xbox 360 S. While they finally (quietly) released a hard drive for the new console, the $130 asking price is a hefty barrier to entry if you're looking for some co-op fun. Microsoft's official Halo: Reach FAQ page confirms the shortcoming:

Q1: The error "One or more players do not have an Xbox 360 Hard Drive. An Xbox 360 Hard Drive is required to play co-op on Xbox LIVE or system link" occurs when I try to play. Why?

A1: One or more players do not have a certified Xbox 360 hard drive attached to their Xbox 360 console. Some multiplayer aspects of Halo: Reach require an Xbox 360 certified hard drive.

Nukezilla further confirms that USB memory sticks can't fill in for the absent storage and UK gamers will have to wait until later this month to get the £80 hard drive. Evidently, this limitation was present in Halo 3: ODST as well. Anyone affected by this issue?

Update: Microsoft has informed Eurogamer that the issue is "temporary" and that the company is "working to resolve it."

[Thanks, Arafat!]