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Personally, I think that Secure Digital flash cards are plenty small. They are no bigger than a postage stamp, and their biggest shortcoming, in my mind, is that you have to be careful not to lose them! However, in the world of electronics, smaller is always better, and SanDisk is moving in that direction.
At the Las Vegas CES, they are introducing the miniSD card, available in a 2 GB capacity. If that is still too large of a form factor, then the microSD, is even smaller, and will be released in a 1 GB capacity.
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At the rate we're going, I expect the nanoSD to be introduced at CES 2007.
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