Digital artifacts - the next battleground?

Consumer Electronics Show (CES) took place in Las Vegas and Apple hosted MacWorld in San Francisco some fascinating developments surfaced. Apple won the media coverage battle with the announcement of the iPhone. One news item from CES was the announcement of Windows Home Server. This is not a Windows Server 2003 product but appears to be an amalgamation of a number of Windows Server oriented technologies. Microsoft are set to sell this as an OEM product. It will not be released as a software package that allows users to install on an existing machine. Instead we will see manufacturers developing headless servers. Interestingly Microsoft plan to integrate this product with their web-based Live service. Expect to see linkups with Microsoft OneCare to provide anti-virus and other protective services.

Amongst all these developments the real battle is for our data. Data is the most important asset in the creation of Web 2.0 services. It is often referred to as the new Intel Inside. Our history, as captured in pictures and videos. Our entertainment in the form of music and movies is increasingly in digital form. At present our digital artifacts are typically tenuously stored on our laptops or home PCs - Often without a backup. The value of these artifacts is far in excess of the value of the equipment they are stored on. The battle is therefore on to encourage us to protect our digital assets and place them in the hands of a third party. Whether AOL with XDrive, Microsoft with LiveDrive, Google with gDrive, Apple with .Mac or some other player such as Jungledisk that uses Amazon's Simple Storage Services the winner has the potential to gain in at least two ways:

1. Access to file contents to refine insight in to customer drivers in the same way that insights can be gained by seeing the email traffic for a user and providing tailored ads based on that content.
2. Customer loyalty. When a user has committed 50GB or more of music, pictures, movies and other information to a storage provider they be reluctant to go through the inconvenience of moving that data to another provider. This provides the opportunity to entice the customer to use other services that can integrate seamlessly with the storage service.

The problem with many of the current web-based storage services is the limited storage they provide. Photo and music libraries are rapidly growing far beyond the space provided by these services.

What are your thoughts about the consumer oriented online storage market? How will it evolve? What is the price point that needs to be reached to make these services attractive to consumers for storage of their irreplacable digital assets? Do you see Google offering unlimited storage for free? Add your voice to the conversation by adding a comment below.