It looks as if the cannibalization of the AT&T Nokia Lumia 1520 Windows Phone hasn't stopped. First you have the omission of the built in wireless Qi charging. Now it appears as if the Lumia 1520's internal storage will be 16GB instead of 32GB that was noted during Nokia World.
Specs for the AT&T Nokia Lumia 1520 at Windowsphone.com and at Nokia's U.S. product page for the Lumia 1520 lists the storage as being only 16GB. The only saving grace is that it is noted that the Lumia 1520 will have expandable memory (micro-SD card slot) up to 64GB.