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One of the most important differences between film and digital photography is the ease by which years of hard work can be wiped out within seconds. Most digital photographers simply store their entire photo collection on a hard drive and expect that the drive is a safe storage medium. Wrong!
Hard drives should only be treated as temporary storage, not long-term archiving. Drives have delicate moving parts and they DO FAIL!. Personally, I have had two drives fail on me: one caused 100GB loss of video work, the other was a drive that was starting to fail -- one that contained my entire photo collection!
That said, some people have used hard drives for long term storage, but these are typically offline drives (i.e. drives that are generally disconnected & off). For the price and convenience factor, it may be a worthwhile option.
Hard drive crashes are a definite possibility, and can occur for no immediately obvious reason. But, of course there are other more obvious failures, such as vibration, water, power disruption and even viruses. Thankfully, some drives start to make odd noises (typically clunking sounds) before they completely fail. This is what occured to the data drive that contained my entire photo collection. Once my drive began to clunk every couple seconds, you can bet that I stayed up all night desperately trying to recover what I could from the failing drive. This is bad practice, and it was a wake-up call for me to establish a much more robust archiving strategy.
Everybody says that they back up their photos.... but how often? It is a nuisance. And if you are adding new photos to your collection every couple days, you can bet that you will often put off the backup or forget to do it.
Rule #1 - Backup to archival media
The media selected should not involve moving parts! From a convenience point of view, the best choice would be DVD-R, followed by CD-R. DVD-R provide you with 4.7GB of storage (enough for most serious amateurs' single-day work). CD-Rs only provide roughly 650MB, which will quickly become tiresome (as it will involve many more discs). However, it has been widely mentioned that CD-R discs provide better longetivity & durability than DVD-R. There are a lot of questions in the online community about the longetivity of these discs and how DVD-R and CD-Rs compare.
Suffice it to say that one should always use quality name-brand media, take extreme care (both in writing on the labels, storage, etc.) and assume that someday you will have to transfer them to another disc. Periodic re-verification and re-burning should be a consideration. Even still, there are many reports of discs failing well before their manufacturer-rated lifespans! Using true archival media (not just name-brand discs) will provide far better protection from these early failures.
Rule #2 - Redundancy
Starting with rule #1, archive to some external media, but make duplicate copies. It is relatively simple to make doubles of these archive discs. Keep one at home and other in another location. If possible, use another brand of disc media. This way, if one brand begins to fail over a number of years, you should have another version to work with (this assumes that you periodically check your backups). The idea behind different locations is simple: you would like to protect against things that happen at home (fire, theft, etc.), enabling you to simply recover from the collection housed at another site.
Rule #3 - Automation
Nobody enjoys the backup process... not only is it time consuming, but it needs to be done often to reduce the cost of a failure. If you can work with some sort of automated process, you are much more likely to maintain the currency of your archive. It is relatively easy to set up tasks that occur every night to perform some means of backup. Whether this is simple mirroring of your photo collection to another drive, or transfering the incremental changes to a remote FTP server, you want something that involves you as little as possible!