Windows Live Folders (beta)

You dreamt about "desktop" remote storage: here it is. They even planned on syncing the remote file folders with the local ones thru FolderShare.
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Originally called “Live Drive” Live Folders is getting off the ground before the rumored GDrive. The service is being launched into a managed beta which will give a select group of testers 500MB of free online storage space.

Users can upload files via a webform or through an ActiveX control. Once on the system, files can be marked public, private, or be shared with other Live users by user name or through email by permalink. Files will be download only since Microsoft doesn’t have an office web suite yet.

Microsoft already has plans to incorporate file syncing into the storage cloud powered by FolderShare, which they acquired back in 2005, stepping on the toes of quite a few startups along the way.