A conventional DVD stores data only on its surface. But holographic storage encodes data as three-­dimensional patterns embedded inside a disc, vastly expanding its storage capacity. A long-awaited holographic drive from InPhase of Longmont, CO, is due out late this year; geared to Hollywood studios and large archives, it will cost $18,000. But a few companies, such as General Electric and Sony, are working on holographic storage systems that could be more compatible with existing technologies.

InPhase's drive stores information in big blasts, 1.4 million bits at a time. That makes data retrieval extremely fast, but it also requires complicated and costly optics. A prototype system from GE, on the other hand, stores information a bit at a time--just like today's media. That means that GE's holographic discs could be played on modified Blu-ray players, which could potentially handle old DVDs and CDs, as well.