Google: A giant hard disk in the sky?

Google has dropped some hints that, in the future, it plans to allow users to put all of their PC storage on a Google online storage service. Unlimited capacity. As this UK report quoted a Google presentation:

...the online copy of your data will become your Golden Copy and your local-machine copy serves more like a cache. An important implication of this theme is that we [Google] can make your online copy more secure than it would be on your own machine.

The presentation is no longer online but extracts plus a PDF of the slides have been reproduced at glinden.blogspot.com.

In my mind, this raises interesting questions for enterprise IT (including small businesses):

• This could be a more secure form of PC storage. Certainly a great backup system. Unless "the Internet is down" and you can't get to it. So is this good or bad for disaster recovery?
• What level of security will Google provide? What sort of assurances or guarantees? Is this good or bad for data security?
• If Google ever does lose some of this data, or has a security breach, all hell will break loose and Google will lose credibility. A heavy responsibility.
• Will button-down, security-conscious organizations really allow employees to put sensitive company data on external servers? Should they?
• What should the IT department's policy be, when employees ask if they can do this? What will Legal say? And what about employees who go ahead and do it anyway?
• Is this a storage method that will pass muster with regulators as prudent ... or will it be viewed by regulators as a reckless form of outsourcing to a third-party on the hacker-friendly Internet?

By the way, the Google presentation also hints that this online-storage plan is a slap at Microsoft, because the "computer platform" will become less important. Again quoting the Google presentation:

This will help us make the client less important (thin client, thick server model), which suits our strength vis-a-vis Microsoft and is also of great value to the user.

P.S. If Google offers this online storage free-of-charge, it could be very bad news for current online-storage providers.