News: To store all the cleavage data of course.
According to it's official game page at Xbox.com, the Xbox 360 version of Soul Calibur IV will require a system with the hard drive. This would make Soul Calibur IV the first non-MMORPG game to require the hard drive on the console.
Furthermore, a rumor on Kotaku says that the PlayStation 3 version of the game will require an 8.5 GB installation before players can get down to the fighting. While this is just a rumor, that would be quite the hefty install for a title that is just a fighting game (for comaprisons sake, Metal Gear Solid 4 only required a 5 GB install).
Hopefully we'll learn more as Soul Calibur IV's July 29 release date gets closer.