I think that is wrong. People can add bigger drives quite easily. The Apple App Store model is actually quite good in that it is very flexible for purchases. The fact that it seems to be doing quite well shows that that the broadband excuse might not be valid either.
Games are a luxury discretionary item so when people are finding things are tough games might be cut from the budget. Though they might decide that they will get a game as a treat so that might add sales.
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