[pg]

Well, a data center using lots of drives can probably use more of the space on them. It wouldn't be unusual for an individual person only to fill up 1/10 of his hard drive. It would be less common for a data center to have 10x overcapacity.

[swombat]

If they wanted to be really clever, they could also analyze the data when it's uploaded and encode it in a less redundant way... for instance, it's quite likely that large numbers of people will have very similar mp3 files... if you could figure out that 99% of a certain file is exactly identical to 99% of another file, why store that data twice?

But, that gets very complicated... you're just shifting the hard drive costs into developer and cpu costs... so it may not be economical.

[guruz]

Another possible cool thing just came into my mind:

http://en.wikipedia.org/wiki/Single_instance_storage