"I would like to replace the 320gb hard drive with a 500gb or possibly a 1 Terrabyte one. Can you please advise if they are both suitable and how they should be formatted, ie NTFS or FAT32. Is it just a straight replacement inside the case, thanks."
"Should work with either mentioned, dont format via Windows, just insert the raw drive, and format via the machine, Format option. I have done this on other makes of PVR, with no problem."
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I've had to do a much more complicated process with upgrading Comcast and DirectTV DVR's, you are very lucky.