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The issue is areal density. You have to either add platters or increase the amount of data packed into the existing platters to get bigger drives. The amount of space inside the standard drive being finite, the data (areal) density must go up.
Now, as you pack info closer together you run into problems with the bits' magnetic fields messing with one another *and* having to make mechanics which can get a head in the right spot to read or write those bits. Needless to say, these are both hard.
While 500+ GB drives exist, they are expensive and perform poorly. At the moment, there isn't a lot of mass-market appeal for these super-huge drives, as is. I expect, however, that the manufacturers should creep up in size, as they refine their technology.
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