You'd figure Microsoft's continued refusal to make hard drives a standard element in all Xbox 360s would mean that no disc-based game could require physical storage. That's been proven untrue before, and the latest outlier to require storage might be the biggest one yet. Halo: Reach, according to the game's FAQ page, requires a hard drive for several online aspects, including the game's co-op component, one of Reach's sharpest and most entertaining features.
Nukezilla was first to point out the flaw and display Microsoft's official FAQ, which confirms the fact that this content in the game is locked out for those without HDDs:
Question: 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?
Answer: 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.
As Nukezilla points out, this news is a huge bummer for anyone who might have just purchased a new 4GB Xbox 360 S (which has no hard drive). Reach can't access that scant amount of onboard memory, nor a large USB stick or other external device. It seems the only way out of this particular jam fast is to purchase one of Microsoft's newly announced $130 250GB slim hard drives. But it's important to note that Microsoft is aware of this limitation and is working on some sort of fix. "We are aware of the issue and are quickly working to resolve it," Microsoft said in a recent statement given to Eurogamer.