When you start out with a fresh new hard drive, it may seem like it has virtually unlimited capacity. The reality, though, is that it won't take nearly as long to max out that drive as you might think, and you will need to find some way to expand your storage.
You can simply upgrade and replace the drive with a larger one, or you can tack on some external storage, but disk drives--both internal and external--are yesterday's technology. Another solution is to embrace the cloud and store your data online where the only limitation to your storage capacity is how much money you want to spend.
The rise of tablets and ultrabooks is driving a trend that makes cloud storage not only appealing, but required. Tablets use flash storage that is generally limited to 32GB or 64GB, and ultrabooks that use SSD drives have 256GB, or even a mere 128GB of storage. In exchange for convenience and portability, you sacrifice storage capacity and the logical solution is to connect to the cloud while you're on the go.
The three primary benefits of cloud data storage are unlimited capacity, virtually ubiquitous access, and backups. Upgrading your drive, or expanding your storage with external drives are both temporary Band-Aids. No matter what size drive you use, odds are good you will one day fill it up.
There isn't any risk of you filling up the cloud. Granted, more capacity will cost you more money. But, with cloud storage you can generally just subscribe to a higher capacity plan and add storage space immediately when the need arises. You can also add capacity temporarily to fill a short-term need, and then roll back to the storage plan you normally use without being saddled with drives you no longer need.
With cloud storage, you have access to your data from anywhere in the world that you can connect to the Internet. You can travel with confidence with your tablet or ultrabook, knowing that you have your data "with you" at all times.
Most cloud storage services also provide ways to share access to files with others, or even collaborate on the files in real-time over the Internet. Having data in the cloud provides you with opportunities to work more efficiently and be more productive than you can with data anchored to your PC.
Another benefit of using cloud storage is that the cloud service provider most likely has redundant servers, storing data on redundant drives, mirrored to redundant data centers. When the data is stored on your PC, or an external drive, it can be lost or stolen, or get corrupted, and if you haven't backed it up recently you're out of luck. But with the cloud, the backups are a benefit that come more or less automatically.
There are two obvious downfalls to cloud storage: cost and availability. When you buy a hard drive it is a finite, one-time investment. But, cloud storage--beyond the 5GB or 25GB you might get for free with some services--requires an ongoing monthly subscription cost.
The cost per month is less than what a drive would cost, so initially the cloud service seems significantly cheaper. Eventually, though, those monthly fees will add up to more than what the drive would have cost you, and you will still have to continue paying them each month.
Availability is an issue because you are dependent on a stable, high-speed connection to the Internet in order to access your data. If the cloud storage provider suffers an outage of some sort you also won't be able to get your data. Some services, like Box, provide a local folder that stores data offline and syncs with the cloud when connected, so you at least have the means to ensure that the crucial data you are working on right now will be available even if the cloud is not.
Another concern is security. Along with the benefit of being able to share your data with virtually anyone comes the drawback that virtually any unauthorized user might also potentially gain access to your data. You need to make sure your data is encrypted--both in transit, and at rest in the cloud--to prevent any exposure or compromise.
Choosing a Cloud Storage Service
I don't believe there is a "best" cloud storage provider. Personally, I use Box, but there are unique pros and cons to each, and the one that works best for you may be dictated by the mobile devices and platforms you use, the types of data you need to store, or the services used by people you need to share and collaborate with.
For example, if you work in a Windows-centric world, and you use a Windows Phone smartphone, it makes sense to look more closely at what you can do with Microsoft's SkyDrive. If you rely on Google products and services, and you use an Android smartphone, the seamless integration makes it appealing to use the online storage offered with Google Docs.
Both of these solutions are limited, though. They offer a generous amount of storage space for free, and provide a means to share files with others, but if you are trying to extend your available storage space to the cloud, you need a more comprehensive service that offers capacity more equivalent to the hard drive you would buy if you weren't using the cloud.
The options are many, and the list is growing. Take a look at Box, DropBox, SugarSync, and others. To choose the one that works best for you, make sure you consider whether the cloud services has a client or apps available for the operating systems and mobile devices you rely on, and that the businesses or individuals you work with will be able to access files if you share them out.