Italian start-up Memopal has said it wants to make storage so cheap that "it will be cheaper to buy more storage space than delete unwanted files."

This outrageous claim comes as the company launches an online backup service to compete with US services such as Mozy and Carbonite, based on its own storage file system.

The start-up was formed in December and the storage product, currently based on a Windows client, is now moving out of the public beta-test phase, Memopal said on Tuesday.

The product is based on MGFS, Memopal's own customised file system, designed to store up to 100 million terabytes in a single file system, according to the company.

MGFS uses checksum-based archiving, native data encryption and compression, native file indexing, hot-add scalability and native hardware health monitoring, Memopal said. Data is stored redundantly on three continents for extra protection from natural disasters.

Users pay $99 per year for 250GB of storage, which is updated in real-time each time the user saves a file, using versioning to reduce data transfer. Users can choose to back-up the entire drive or only selected files or portions.

More than one system can be backed up to the same user storage space, which can be searched from a web interface.

Users can share any file through a one-click procedure that creates a URL for the file, the company said.

The company plans to release a developer kit and Mac and Linux clients in June, and plans to translate the software into 40 languages.

Another European online backup company is SquirrelSave, which launched earlier this year offering 20GB of storage for £4.95 per month.

The demand for digital storage is skyrocketing, with user-generated digital content growing from 5 Exabytes (that's five billion gigabytes) globally in 2002 to 161 Exabytes in 2006 and estimated to reach 988 Exabytes in 2010, according to the University of California at Berkeley.