Hewlett-Packard and Sony announced they will work together to develop a new generation of Digital Audio Tapes, called DAT 320, which will be built on an open standard so that other companies are able to contribute.

Although the two companies are collaborating to create the Digital Data Storage (DDS) standard, they both have plans to offer DAT 320 tape drives and cartridges that will eventually compete against one another. The Sony and HP products will have the same speed and capacity, though it's likely their firmware will be different, even though the drives will be interchangeable.

The DAT 320 will be able to back up data at a rate of 86 gigabytes per hour using a 2:1 data compression, and can provide 320 GB of storage on a single tape cartridge. Today's standard, DAT 160, can only support 160 GB of data storage on a single cartridge. DAT 320 will be backwards compatible with DAT 160.

DAT 320 should be available sometime in 2009, both companies estimate.

Even though HDDs are dropping in price while at the same time increasing in capacity, tape drives continue to be a valuable commodity for many small and medium businesses. But HDDs and tape-based storage devices will coexist well into the future, while the tape backup industry is predicted to be a $1.5 billion market in 2009. More than 18 million tape drives and 400 million tape cartridges have been shipped over the past 20 years, and analysts expect the demand for tape drives to increase over the next two years.

Businesses considering a move away from DAT/DDS may now think twice before switching. DAT 320 may enable companies with space constraints to increase data storage without having to buy additional hardware.