Nintendo has allowed for streaming of their VC and Wiiware games right off the SD card for a while now. For  GH and Rock Band, the SD card was only used to store songs until there is room to load it to the console. IGN GH 5 Preview says that has all changed:

All the tricks used for both Guitar Hero and Rock Band in the past – leaving internal memory open– is gone. Instead, straight-up booting off the SD card is available, and that means easier downloads, larger expansions, and quicker loads when bringing in song data from the SD card into GH5.

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