Have you seen this message when trying to upgrade to iOS 8 on your iPhone or iPad? Have you just decided not to upgrade because you don't want to give up gigabytes of storage on your device?
You don't lose any storage permanently (well, probably a little, but nothing to worry about). It just needs this for the update process and then you get it back. So remove a movie or two, do the update and load the movies back. But this only applies to doing the update when it's not physically attached to iTunes on your Mac or PC. When you cable it up, the upgrade requires much less. You have choices.
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