As for the target audience I think it is enormous. Very, very few people currently need more than 36 GB. Think of all the people out there who don't edit videos or download MP3s. Virtually none of them need hundreds of gigabytes of space. I bet you all the money in the world that the top selling drive at major OEMs isn't in the 100 GB range - that is simply since most people don't need that capacity.
I agree, most people don't need any more than say 10-20 GB of space.
My parrents have a 40GB 120GXP that I got for them after their original HD crapped out.
There are two reasons why I got them this HD instead of some cheapo 20 GB HD.
For one, there was about a $20 difference, so I figured I might as well get them a bigger HD just in case they ever need it.
And secondly, and more importantly, the 120GXP is far faster than the 20GB hd's that were aviable, and indeed, they have mentioned that the computer feels much faster since the change.
However, how many people like my parrents(that is, non-enthusists) are going to pick up Raptors?
Avarge Joe's wont pick them up, and Compaq, Dell, etc won't put them in their mainstream computers, so in the end, the Raptors won't find their way to the people that really don't need alot of storage.
Enthusists often want more than 36 GB of storage, for games, mp3's, DivX's, etc etc, and sure, some will buy a Raptor to put their OS and apps on, but Im betting in the end, most people will just pick up a 180GXP, 2000JB, etc instead, simply for the comfort of just having one drive.
Not to mention price.
So, basically we're talking about a niche in a niche.
But of course, the Raptor is a bit of an experiment for WD, I doubt they expect to make any money of their initial generation of SATA 10K drives.
When they become more established I could see the major OEM's putting them in their workstations and high end computers as a cheaper alternative to SCSI.