Credit:
A quick update on Amazon's S3: someone has finally built a virtual hard drive that connects directly to the service. JungleDisk is free to download, and you only pay Amazon's basic rates for storage and bandwidth. At $0.15 per gig of storage and $0.20 per gigabyte transferred, that's much cheaper than competing services. It works on the Mac, Linux and Windows.
JungleDisk is neat, but because of the pricing structure, it's probably more useful as a backup drive. It's not the prettiest of applications, either. Still, you can't argue with cheap.