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Win an HP Envy 15 Notebook!
I haven't been let down yet.
My Windows installation resides on my C drive and all my data on the D drive (mapping My Documents to D also to keep things simple).
Re-installing Windows with my programs, frequently, became tedious so rather than go through the whole painful process I now use Norton Ghost to clone my C drive and store the image files on an external HDD. If Windows fails or starts misbehaving then I can get my machine back up and running within 30mins...I also make OS backups each time I have a significant number of new programs configured and working trouble free. This really takes the pain out of hunting round for installation disks, serial numbers etc...
For data I found that Norton Ghost took too long (as it copies all files). Instead I use Beyond Compare. Each week I do a compare of the files on my external HDD and those on my machine and just sync over new/deleted/changed files.
External HDDs have the usual drawbacks and won't stop those pesky llamas but kept in a differnt room it's pretty safe. If you're seriously paranoid about your data then there's always those fireproof safes....but that could end up expensive and a pain if you're making daily backups...
Personally, I use my webhost as a backup for really important stuff that I would feel crushed if I lost, photos or my family, important documents, etc. I also use a cheap Ubuntu box for almost everything I have. I use rsync to automate everything. It's free if you've got extra parts, or for the price of a Drobo (or less!), you've got a second computer that you can do tons of stuff with.
The stuff that I don't keep backed up to my host I keep a list of with an automated bash script, so if I lose my music for instance, I've got a list of what to redownload.
If your backup set is less than 1TB, the DNS-323 is an excellent choice - cheap, relatively fast, very compact, quiet and power-efficient. As a side benefit, since it has an iTunes-compatible DAAP server, I can listen to my backed up music collection at work using iTunes sharing.
It incorporates collaborative online editing of documents. Not sure tho' how it works storing big files such as movies.
http://www.elephantdrive.com
Other I've heard are good are Mozy and Carbonite.
That data used to live on a dedicated media drive until it failed. I was able to pull all that data down from Mozy. Did it take FOREVER? Sure, but I had the data back.
I'm quite interested in checking out the other solutions mentioned above because I would like a home RAID as the first line of defence for quicker restores, but would still let Mozy hold on to the data in case anything happens to my office/house.