The Wall Street Journal is out with a story today shedding a little more light on Google's (NASDAQ: GOOG) online storage plans. The WSJ article claims hat the search giant is planning on launching an online storage service in the next few month to enable users to store documents, pictures, and music on Google's servers. Google already provides some level of storage via its image hosting service, Picasa, and Google Docs, Google's online stab at competing with Microsoft's (NASDAQ: MSFT) Office Suite.

The rumored Gdrive is one step closer to reality. This will probably be a two-tiered service with a free version and a premium version for which users will have to pony up some money. Don't look for this to provide short-term meaningful revenues for search behemoth. Something more important, though, is happening.

As Google continues to fuel rumor mills-a-plenty about the unveiling of its online storage service, now Microsoft is also in the mill. Google's rumored "GDrive" has been joined lately by talk of Microsoft's "Live Drive" service, which would also give customers the ability to store vast amounts of information on Microsoft servers far away from homes and businesses.

But Microsoft's service is not a rumor -- the company has confirmed its existence. Up to two gigabytes will be available to Microsoft Live Drive customers for free, with more storage available for a fee, which has not yet been disclosed. With Microsoft starting to pump up its "Live" services in anticipation of the launch of Windows Vista, it better hurry -- the Vista launch, unless it slips again, will be here in January 2007.

Google's rumored service may just be around the corner as well. But the company has not even speculated that it may be working on such a service, let alone that it may ever offer a service like this. No surprise, as Google loves to launch products with little to no official foreshadowing . Will the online storage "battle" be publicly won by Google or Microsoft -- and will customers trust large chunks of data to either company? For images and documents not of a sensitive nature, I think they will.

Recently, I took some shots at Microsoft's Private Folder on BloggingStocks.com.

It was definitely an easy target. Basically, it looked like a poorly thought out concept. That is, a Private Folder allows Windows users to keep a password-protected file folder. OK, that is good news for those who want to hide deep secrets, right? But, what if you are a corporation and employees start using it?

Apparently, these are the kinds of questions some managers fail to ask at Microsoft.

In the economics world, there are so-called "Fed Watchers" that scrutinize everything about the Federal Reserve. After all, there's a lot of money at stake.

Well, in the blogosphere, there are Google Watchers. And, of course, there is a good amount of investor money at stake here.

The latest sighting:  a web page of the eagerly awaited GDrive.  Apparently, the Project is codenamed "Platypus."

The Google Watcher who made this coup is Corsin Camichel. He found a document about Platypus on Writely.com, which is Google's online word processor.

Basically, it looks like GDrive will be your ultimate storage system for your computer (and, of course, Google would like it to be your only one). 

In fact, some GDrive details leaked out during a March Google investor conference. Basically, GDrive's goal is to "Store "100%."

Suppose you lose everything on your computer (because of a virus). Using GDrive, you can recreate your system.

Other cool things:  Using the collaborative nature of Writely.com, GDrive will allow users to share files. What's more, there are sophisticated synchronization features for computers that run on different operating systems.

Think Google doesn't want to takeover the desktop from Microsoft? With GDrive, Google is likely to take enormous amounts of people's data onto the Web – that is, Google's Web.