Cloud is a technically-infinite storage solution, but nobody has the nerve to go all the way with it because it's cyberspace, not real, and therefore can be lost with a simple global energy crisis.
It could be a solution to the lack of internal storage space if Nintendo wanted to, I don't know, actually stay ahead of the game and offer something other consoles don't have, but a mere 512 MB is a joke. Amazon gives you 30 gigs FREE upon using their service.