That is a different kind of storage.
You have
1: Memory (game client)
2: Memory (game server)
3: Disk (game server)
4: Memory and disk (cross-server instances)
5: Network bandwidth (game client to game server)
6: Network bandwidth (game server to other servers)
7: Disk bandwidth (amount of bytes that can be written, usually measured in IOPS not bytes)
So if you look at the requirements for V3 and later of Final Fantasy XIV, it's now 64-bit, that removes the 2-4GB limitation imposed by running a 32-bit binary. However the PS3 was still just a 32-bit system, thus everyone on a PS3 needs to upgrade to the PS4 or switch to PC in order for the game client memory hurdle to be overcome.
If V4.0 will not have a PS3 version, and the PC version will only run on 64-bit Windows, that removes problem #1 except for people who are running only 4GB of ram, for them they may get swap page thrashing under some circumstances.
For #2, Servers bought for V1.0 in 2010 likely were of the Quadcore Xenon X-series family. Current servers are E3 or E5 family and are roughly twice as fast,clock-for-clock than they were in 2008. That said, you can also get 24-core systems where before you could only get quadcore. The nice thing about the X-series and the E5 series of Xeon's is that they have a much much higher memory capacity, and it's usually doubled with every additional CPU. So a 4-way E5 system can likely have 1TB of ECC RAM.
Which brings us to #3 Which is how fast can that be synced to disk. Guess what you can't sync 1TB of data to disk even with SSD's. The highest you can currently get is a PCIe x8 card that can write 2GB/sec. So if that's the case, then it's likely the game environment has been sized to fit the largest possible sync size. That said...
When you start an instance #4, the more that needs to be transferred from one server to another , or some kind of "inventory and gear server" the longer it takes to sync. Since network topolgy is often defined in Gigabits (eg 10GigE) it's very likely that the amount of data that can be transferred is kept down to avoid a situation where the instance server crashes from overload and all loot acquired is destroyed.
The network bandwidth is the worst bottle neck in #5 and that is likely what will keep Square Enix from increasing fixed-inventory. If you have 100 items plus the armory and equipped gear, you have 13 gear slots for armory, so 425 items you keep on your person at all time plus 14 gear items worn, plus a quest inventory which is actually another 75 spaces. Grand total: 514 item slots. Plus the 18 crystals which are likely just stored values. Let's focus on the items though.
So every slot in the game fits any other gear, there appears to be about 20 values for gear (not including colors, colors are likely a RGB value or a "paint bucket item" color from a more limited palette.) So 514 items * 20 values = 10280 Bytes
So outside of moving around and using skills itself, every time something in your inventory changes, or you have the inventory/gear window open, about 10280 bytes have to cross the wire. Likewise any time you look at other peoples gear.
Which brings us to #6 , if the game simply tells your game client to connect to instance server at X ip address, then all that gear goes with you. Thus if you start fidgeting with gear during the dungeon, you are actually telling the instance server to make changes to your inventory even if all you did was switch slots. At the end of the instance presumably it syncs the inventory state then, but it's also likely it syncs it every minute or so during the instance to avoid "duping" bugs caused by intentionally crashing the server, or disconnecting and thus consumed items are rolled back.
Which circles back to the disk space and bandwidth in #7. The fastest PCIe x8 SSD you can get is about 2.2 GB/sec, and these things get slower over time, so you could never actually write 2GB in one second for 5 years, more likely the SSD's are cycled out during maintenance if that is what they are using. If they are using mechanical drives, this drops from GB's to MB's. Since the data might change in memory before it's written, that introduces lag.
Thus anyone who has been on a server when disconnected, or it starts lagging has experienced this.
So it's not really a question of why not, but what they have to sacrifice to get more inventory space. Most people could quite literately settle for having 8 free retainers, or maybe 2 that can operate a shop and 6 that have no shop access, but that doesn't solve the loot bloat problem where players (particularly with things like rings) where they can't keep all the gear needed to have a unique outfit for every class. There are 25 spaces in each armory, but there are TWO ring items needed for each, which means we actually need one for the left and one for the right, or for that space to be 50. But that also points out another problem with the main hand gear, the class requires one, the job requires another, you can't equip your job main hand weapon and some gear to the job version. So the only on-player inventory expansion justified is perhaps with the armory.
A way this can be reduced, is by imposing a few limitations too, like they could do a GIGO (garbage in, garbage out) rule with dungeons and PvP where only the stuff put in a specific inventory container comes into the dungeon, and everything else acquired during the dungeon must go into that container to take it out. Instead of taking all these crafting and farming materials into the dungeon, only allow consumables into the dungeon, and the gear the player is wearing. If they are not wearing suitable gear when the DF window pops up, warn them that they will be refused from the duty if they are wearing any unsuitable gear (eg crafting gear.)
Which brings us back to the Glamour log question, Obviously someone with 1000 different gear items that they only want to use for glamour can be "destroyed" when put into the log so it's reduced to just an item id and a color, from 20 bytes to 3. If you can't change the glamour arbitrarily during the dungeon that is one less thing to be synced. If you can only change the glamour in your inn room or house, that saves even more since it won't be changed outside of that space.
As for wallets, again, if it's reduced to only being able to see that inventory container in one location, that removes the need to sync it since it will never be in memory on the server until you're engaged with it. That's why the retainer is the easiest way to add inventory. The mechanics for it already exist. The problem I'm guessing is that if they are all "shop"'s it makes the shop system run slower since all of these shops have to be continuously running. So the solution is simply only allow two retainers to be shops at any one time, and to take down a shop all the items for sale must be returned to the retainer's inventory.



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