Is storage as a service back?

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"The approach does require bandwidth but not as much as you would think - our backup is continuous or nightly, and does not affect our network performance. In addition, there is the option to use bandwidth throttling."

Another area where online storage is helping companies of all sizes is backing up mobile devices. Once you have more than a handful of laptops out and about, keeping them properly backed up - as required by law or regulation - can be an expensive nightmare.

Backup services are single-purpose storage services, though. As with Google Mail, Flickr and Salesforce.com, there is online storage there, yes, but it is tucked away behind an application.

Cloudy forecasts

Where storage-as-a-service gets more interesting is when we get to the likes of cloud storage - online capacity which you can use for whatever you want, whether it be snapshots of your virtual servers or snapshots of your kids.

At the enterprise level, this means Amazon S3 and Nirvanix's CloudNAS, for example. In the consumer area, it's Microsoft Live Mesh, and it looks to be where Google is going with GDrive.

Cloud storage could succeed where the SSPs failed because there's more bandwidth now, plus new technologies that dramatically push down the cost of providing storage, argues Tony Reid, the UK solutions director at storage vendor Hitachi Data Systems.

In particular he identifies thin provisioning, which lets the service provider assign costly physical disk space to a logical disk volume only when it is actually written to, and virtualisation, which lets them provide - and charge for - different service levels or storage classes.

He has two caveats for potential cloud storage users, though. Firstly, you can outsource your storage management but not your regulatory obligations.

"You still have to demonstrate that your data is protected, and that backups are taken and checked," he says. "And you need to be able to decide if an application really is business-critical, or is just an archive. The majority of services I see out there are still one size fits all."

If it does take off, the benefits to users could be significant, claims Sachin Duggal, the chief executive of virtual PC provider Nivio, which recently launched a cloud storage service. This is accessible either as a network drive via a synch-enabled client program, via FTP or through a web browser.

Flexible access is vital if you want to persuade users it's more than just a backup target, he says.

"Compared to a USB stick, you can't lose it and you don't have to carry anything. You do need a network connection, but our research says many people don't use a PC offline any more - 80 per cent to 90 per cent of their work is online."

Duggal says his biggest challenge is also a potential opportunity - launching a service just as Microsoft and Google enter the market.

"It means cloud storage is a hot topic, but it also means we really have to get our messaging right," he says. "We think it is a little bit for backup, but it's also for online access. We think that the future is a hard disk and processor in the cloud, and the consumer just accesses it."

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