BlueString: Is AOL raising the bar for online media storage?

Time Warner Inc.'s (NYSE:TWX) AOL unit recently announced the availability of a beta version of BlueString, a free site that enables users to easily upload, store, manage, create and share many kinds of digital media. It will centralize and act as a backup for photos, videos and music stored externally for users.

BlueString provides the ability to manually (or even automatically) upload personal media and to create rich multimedia shows that can be shared with family and friends. An innovative feature called "String it" makes it easy to collaborate, allowing several people to add media assets to one show.

BlueString offers up to 5 GB of free online storage and, beginning this fall, any user with an active email address from any provider can easily register to use this product for free. An upgrade to preserve online media with the ability to upgrade to 50 GB is available at $99 per year. Users can also invite private groups of friends and family to view their personal media collection or even embed their media on a Website or blog. This concept was created by AOL and is to be powered by the Xdrive operations.

It sounds like the real winner will be Joe Q. Public. Once free storage is offered by one content provider it tends to happen rapidly elsewhere. In fact, this is somewhat an evolution of the obvious -- but a cool obvious. This entire push will probably go outside of AOL, beyond what is already available. Google (NASDAQ:GOOG) has YouTube, Yahoo! (NASDAQ:YHOO) has its Briefcase and Microsoft (NASDAQ:MSFT) has Live. Now the competition will likely boil down to which company one-ups the others.

This online media storage and quasi-available-to-public feature is also going to continue the fight against Getty Images (NYSE:GYI) for smaller end-user media buyers.