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Online storage firm shutters file depot ceases its free storage service, prompting many of its customers to scramble to retrieve their digital files before they are deleted.

Online storage company has ceased its free storage service, prompting many of its customers to scramble to retrieve their digital files before they are deleted.

San Francisco-based Myspace says on its Web site that people can obtain their files until Friday at 5 p.m. PDT. Myspace previously let people store, organize, share and distribute digital files--including music, photos and documents--for free through a password-protected account.

"This will be the only period of time you will be able to retrieve your files," the company's Web site reads. "After this date, Myspace free consumer site will be closed. Myspace customers will not be able to access their accounts, and, to ensure your privacy, all stored files will be deleted."

The company could not be immediately reached for comment.

Myspace is the latest online storage company to stumble amid the economic downturn. In February, Driveway closed its storage service and laid off three-quarters of its staff.

A month earlier, FreeDrive shuttered its file-swapping service, which let people store and share files with strangers, citing Justice Department concerns that the service could be a haven for copyright pirates. The company still provides access to private, password-protected folders.

On its Web site, Myspace said its customers will be able to download their files or use its CD-burning service, which will mail customers a CD with their files. The site also recommended that people sign up for storage services with FreeDrive.

Jarvis Mak, a senior analyst at Nielsen/NetRatings, said that people have been using online storage sites as an "underground" way to distribute pirated files. As a result, that issue became the biggest hurdle for many online storage companies. In addition, portals offering online storage services also became big competitors for storage-only start-ups.

"What we see now, obviously, is the closing of Myspace and Driveway point to the fact that (online storage sites) are having a hard time surviving," Mak said. "They do need to move to some kind of niche...or move away from a consumer model to a B2B model so they can survive. As a pure consumer service, I think they would have a difficult time, as has already been witnessed."