Small Capacity

There is no hard drive. The flash memory cannot be increased. Any amount of data can be stored in the cloud. It is unlikely that you would need instant access to a terrabyte of data. Feel free to choose from any other company a tablet device with a terrabyte of storage.

The idea is that you download cloud data when required. If you need a couple of hundred thousand tracks of music to be available instantly on the press of a button you need to choose a different device.

There are some wireless external hard drives that can be used with the iPad.

Best iPad External Hard Drive Storage Options

http://www.unlocktips.com/2012/11/best-ipad-mini-external-hard-drive-memory-stor age-options/

iPad Storage Solutions

http://www.ipadstoragesolutions.com/iPadWirelessStorage.php

SanDisk Connect Wireless Media Drive http://www.sandisk.com/products/wireless/media-drive/

Another option:

Expand your iPad's storage capacity with HyperDrive

http://www.macworld.com/article/1153935/hyperdrive.html

On the road with a camera, an iPad, and a Hyperdrive

http://www.macworld.com/article/1160231/ipadhyperdrive.html

 Cheers, Tom 

iPads and iPhones use MLC NadN FLASH chips for storage. If they put 1TB in an iPad, the iPad would cost more than a MacBook Pro and nobody would buy it.

Someday I'm sure you will see that much storage in a hand held device, but FLASH storage prices need to come a long way down before that becomes remotely marketable.

Conventional hard drives have been decreasing in size, and in price, far more rapidly than all solid-state FLASH storage. I suppose Apple could move back to conventional hard drives, like they had in the original iPods, but honestly I don't see it. FLASH is more compact, much more energy efficient, significantly faster in I/O and far less prone to physical damage in a tablet or smart phone style mobile device. Those littel 5mm hard drives, while impressive, still retain all the shortcomings of any conventional hard drive.

But none of us knows what may or may not come out in any future device, so we'll all just have to wait and see.