For certain scales and usage patterns.
a 1.5TB* Tape is about $50. However it: (1) should last longer than a HDD and (2) Uses much less power, cooling, floor space, etc.
* Tape also has really nice compression (essentially you would be using the on-tape compression at least 95% of the time) with an average of about 2:1 (and often much higher). But you can also compress files on disk -- so it's just native storage.
Also -- Things like the SL8500 are such beautiful pieces of machinery. Computers + Robots = Awesome!
Editing to Add: LTO5 was released in 2010. LTO6 is likely to arrive this year with 3.2TB Native Capacity. (And the usual speed bumps of 50% Write // 100% Read speed). The roadmap for the tech is here: http://www.spectralogic.com/common/images/products/lto/lto5/...
It is hard to find pricing for the equipment, which makes me think it is expensive.but it could still potentially be cost effective. However it seems unlikely to come in at 10% of Amazon, ie at $150 per TB per year. You might be better off building your own robot for this application too, with more storage space.
Spun down hard drives would be a similar price. Not necessarily easier to work with.
I think spun down HDs would be a lot easier. They have standard interfaces which makes them cheap and flexible. Get a bunch of USB 3 docks[1] and some $10/hour clerks to shuffle the drives around.
Forget the clerks and USB. Get the very cheapest USB to ethernet chipset you can, on 100 mb ethernet, and only power it up when you need drive access. You should be able to do that at $10-20 a disk. No moving parts to maintain.
The big question is scale: tape robot systems are expensive to purchase and somewhat less reliable compared to an HDD so you have significant infrastructure costs bringing up the storage system, establishing a system of off-site rotation and redundancy, testing restores on separate drives (one common failure mode is that a tape drive slowly goes out of alignment, writing data which cannot be read by a calibrated drive), etc.
These are great examples of something which could be commodified so a provider could amortize them across many customers but the margins are continually tightening.
