Out of the box, the Redux Model 1 will offer limited built-in solid state storage, possibly no more than 1GB. This will be plenty enough to store the operating system and a fairly decent set of applications, but content will be stored on removable SD Card media. There is a simple reason for this: plummeting prices for NAND memory.

As of today, one can buy an 8GB SD Card for less than $70. Next month, you will be able to grab a 16GB SD Card for less than $300, and later in January, $700 should get you a 32GB model. If we fast forward to September 2008 when the Redux Model 1 will be released, $200 should get you 16GB to store your content, and $500 might get you 32GB.

When you’re in the business of taking customers down an upgrade path like media player manufacturers are, you want to solder your NAND chips into the device. But when all you care about is to experiment with a new form factor, you keep the chips on removable media for customers to benefit from the NAND equivalent of Moore’s law. That’s pretty much what we’ll do.

With 16GB of storage and using Apple’s metrics for the iPod, you get enough space for 3,500 songs or 20 hours of video. With 32GB, you get both, plenty enough for an average music collection and non-stop video for a trip from San Francisco to London and back.

To make a long story short: removable media is the way to go.