On June 3rd, Microsoft added an update on the Xbox One that enabled External Hard Drives. Unlike the PS4 which gives the user the ability to replace the existing hard drive, the Xbox One will need to rely on USB3 hard drives. This is great news because the internal capabilities of Xbox One internal hard drives is only SATA II (3 GBit/s transfer rates). USB3 hard drives provide transfer rates in upwards of 10 Gbit/sec. By putting your new games on an external drive it will essentially reduce your game load times.
There are many external hard drives to choose from, the right one for you depends on your budget and if you are going to use this hard drive for everything. Because of the load time improvement I recommend using your hard drive for everything.
3. Portable Hard Drive vs Internal with Docking Station
The WD My Passport Ultra line offers very affordable external hard drives. Originally $99.99 and $139.99 WD offers 1TB and 2TB models for only $69.99 and $109.99 currently. This is my #1 recommendation not only because its cheap but 2TB is more than enough storage to handle all the games on the market. These models also have over 13,000 ratings with an average of 4.5/5.0.
WD My Book 4 TB USB 3.0 Hard Drive with Backup
If you feel like 2TB is not enough go with the WD My Book 4 TB USB 3.0 Hard Drive or the Seagate 4TB Portable External Hard Drive USB 3.0 STDA4000100 This Seagate model has over 3000 ratings at 4.5/5.0 with a cost of about $250.00 and the Western Digital Drive costs about $150.00 Both hard drives are USB 3.0 and backwards compatible to USB 2.0 if you choose to use the hard drive for other things besides your Xbox One in the future. The reason for the price difference between these two 4TB drives is the design and the fact that the Western Digital hard drive requires an additional power source.
Some of you may choose to use a Solid Slate Hard Drive with your Xbox One or an internal hard drive. To accommodate for this you will need a docking station such as Plugable USB 3.0 Hard Drive Docking Station