Let's waste space just because we can?
I extensively use virtual machines--those things don't have a whole lot of storage, and I also like to limit each virtual HDD to 25GB (the size of a BD-R disc; it's convenient for backup). Also, my mother has a laptop with a 64GB SSD (a hand-me-down SSD that I had retired when I replaced it with something bigger; that SSD used to be in a desktop that had a large spinning drive to handle the bulk data). I was surprised how little space it had left the last time I checked in on that system. Yea, we could pop in a 120GB drive, but this is a casual-use web/mail/office system, so we don't like the idea of spending more money on it (and that would defeat the purpose of my recycling that 64GB drive).
I would call that a non-typical case that doesn't really fall under the purview of the OP's question though. Most people aren't running a bunch of VMs and trying to keep them under the size of a single blu-ray disk for optical backups. Likewise, who cares if Windows takes up 20 out of 64GB on a machine used for "casual web/mail/office" if the user is literally *never* going to use anywhere close to the remaining ~44GB? At that point you're saving space just because you can, to no tangible benefit. Windows got bigger and takes more space. I'm not saying waste just to waste, otherwise I'd spend my day padding my collection of ISOs to match the maximum size of their intended optical media, but hardware and space requirements are going to keep creeping up over time and it's not always a negative thing to accept that and spec out machines appropriately. Could I save 2GB poking around with command line tweaks trying to optimize storage? Probably, but an afternoon of my time is worth more to me than the $60 it would cost to just toss in a 750GB secondary drive and never worry about it again until it's time for a new machine entirely.
You're absolutely right, which is why I said "move to", not "upgrade to"That's not really true. 8.1U1 does not take any less space than 8.1. The space savings being alluded to are for WIMBoot. Instead of installing Windows by decompressing the Windows system image into a bunch of loose files, WIMBoot installs Windows by keeping that compressed system image intact and booting directly from it. It saves several GB through the compression of the image, and some more by eliminating the need for a separate recovery image (since a perfect reset of the system can now be done by just clobbering everything but the original image, which remains read-only).
This obviously will incur a penalty (for run-time decompression) and has its limits (it won't fix the problem of "update cruft" accumulating over time since updates are not compressed back into the image and the original superseded files are never removed), and it's something that a system builder does at the factory (there is no pretty UI to do this: it requires a lot of command-line fun, in addition to, of course, reinstalling the OS).
It's aimed mostly at tablets, like my Dell Venue 8 Pro (with 32GB of storage, I really do feel the pain on that system), but as I said, merely upgrading to 8.1U1 won't confer me any benefits on the space front. I'll need to nuke, repartition, and reinstall (and by "reinstall", I mean "reinstall manually from the command line using the ADK and WinPE, not with a friendly GUI") before I could reap any of the benefits of WIMBoot. (I will do it eventually, but after having read all the documentation to see what it all entails, I'm not exactly looking forward to it.)
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