Although it's a little late to the game, Microsoft's free hosted storage service entered the market with a lot of noise. After all, the company is giving 5GB of storage away for free to any Tom, Dick or Sally and consumers are ready to gobble up that storage.

But, is there anything new here? Other service providers have been giving away free hosted storage for some time now, and many more vendors are offering larger capacities and advanced backup add-ons for just a few bucks per month.

The big difference here is that Microsoft really isn't talking about hosted storage per se, but is focusing more on the collaboration aspect of Skydrive. Of course users can save files and data to their own encrypted folders located on a Skydrive, but the bigger picture here is how easy it is to share those files with others by creating shared folders.

What's more, Skydrive users can deliver particular files via a hyperlink, just select the file, input an email address and the recipient gets a link to the file—nothing could be easier.

But, there is a catch here: For you to effectively share files, especially shared folders, your friends and coworkers will have to sign up for their own Windows Live accounts, and once they sign up, they will have access to a plethora of other free services. The real threat here is to Google, ZoHo and others that are looking to build up their customer base by offering free hosted services and applications, Microsoft might very well be able to trump them.

There should also be some concern here for the channel. Skydrive completely cuts VARs out of the picture, at least for now. Customers will deal direct with Microsoft for their Live services (free or otherwise) without having to interact with a Microsoft Partner or VAR. True, this will only impact the smallest of business, but as those businesses grow and need more space or services, the conversation will occur between Microsoft and that customer, not with a Microsoft Partner.

The technology itself seems sound and could prove to be a benefit to most any user that is connected to the Internet, but if Microsoft want's to turn this service into the latest killer application, all they need to do is add a synchronization option and have the hostage storage space appear as a local drive on the desktop. That way, if users are connected, both the local machine and the hosted space are updated—an instant backup, if you will—and using the service becomes that much easier. Issues about whether or not you have a connection are eliminated (think about the sometimes connected traveling notebook user). The technology is all there to make this happen, Microsoft Windows XP and Vista offer an "Offline Files" capability and Web 2.0 technologies make it possible to synchronize directories—Microsoft just has to do some simple integration and then a user's data can live wherever the user needs it at any given time!

Perhaps Google, ZoHo or others will beat Microsoft to the punch here and give the connected world a truly portable, remote drive!