Google has announced that Google Docs [1], which could formerly store only online versions of its own word processing, spreadsheet, and presentation documents, will be gaining the capability to store any type of file [2] that you can upload from your computer. Google is rolling this feature out over the next few weeks; look for a notification in the Google Docs header when it's available for your account.
Files can be up to 250 MB in size, and Google provides 1 GB of storage space for free. The 1 GB of storage is consumed only by files that are not converted to be native Google Docs files. You can purchase more Google storage [3] for $0.25 per 1 GB per year; the smallest amount you can buy is 20 GB for $5 per year. That additional storage is shared among Google Docs, Gmail, and Picasa.
When used with the relatively new shared folders feature of Google Docs (see "Google Docs Adds Shared Folders for Easier Collaboration [4]," 13 October 2009), uploaded files can be shared with collaborators. Until the feature is enabled for my account, I can't tell if that sharing goes beyond simple downloading to a group, or if it's possible to make files available to the public as well.
Google does say that if there's excessive bandwidth use, they may limit access for a period of time, much as does Dropbox.
Speaking of Dropbox [5], although this new capability of Google Docs is welcome, it's not nearly as interesting as Dropbox, which synchronizes files between computers in near-time, provides online backup and versioning, offers an iPhone client, and makes it easy to email links to large files. Now if only Dropbox would add the capability to share any folder, rather than only folders within the special Dropbox folder.
[1]: http://docs.google.com/
[2]: http://googledocs.blogspot.com/2010/01/upload-and-store-your-files-in-cloud.html
[3]: https://www.google.com/accounts/purchasestorage
[4]: http://db.tidbits.com/article/10646
[5]: https://www.getdropbox.com/referrals/NTU3NDMzNjk