Philipp Lenssen outlines how a Google Drive (online storage by Google) might work. It’s well thought out, runs nicely in parallel with the current Google service offerings, and makes perfect sense. It’s all hypothetical, but it’s well thought out and (if they’re doing something like this) probably pretty close to Google’s own plans.
The biggest qualm I have on this sort of setup is the time lag between the Net and the PC. When you start talking about mass upload/download or regular access of Google Drive files, the Internet lag (vs hard drive or local network) will be perceptable and significant. One-off access via GMail is one thing; upload/download in bulk, or accessing every file online that way might be a showstopper. I can see using it as backup or individual file access, but I can’t imagine using it as an actual filesystem replacement (though the use of online image systems, including Google’s Picassa, might indicate I’m really wrong here).
The other qualm is the whole on/offline thing. While online access continues to be more and more persistent, there’s still plenty of places where it’s not practical or affordable. If you put all your eggs in an online basket, it would be easy to have that unavailable when you actually need or want it. That’s becoming less of an issue over time, though, as we become more persistently connected.
Not sure if Google really is looking to do something like this — it’s been long-rumored — but, if so, I think a lot of folks would use it for a lot of reasons. One of those folks would likely be me.