One of the main reasons for me to get an external hard drive was so I could easily transfer music over to friend's computers, or take it with me to a party and have a portable entertainment center. Besides music I've got TV shows, movies, a crap load of RPG books in pdf format, and quite a few comic series. No way I'm carting around my desktop every time someone wants something of mine and it's far easier than putting things onto CD's, especially with the movies and tv shows.
Fair enough, I'm sure also the smaller size played a part. My TB hard drive isn't small enough to go into a pocket and has some pretty hefty weight to it, however it is certainly not monolith in size.