I see from Verbatim's product page for the Store 'n' Go that the march towards flash-based hard drives has now reached 12 GB, albeit in a unit that's about three times the size of a thumb drive.

In addition to its relatively massive capacity, the RAZR-sized device sports a USB connector that folds away for safety, Auto-Synchronization and Mobile Launchpad, a U3-like operating system built into the drive that allows you to download and install applications and run them from the drive. Given the increasing size and capability of these drives, I wonder how far away we are from a point where computers become terminals with monitor, input devices and a port for plugging in your portable drive, complete with operating system and all of the programs you need to work or play.

Via Kansas City Star