Google is set to extend its online storage services in a bid to become a central repository for the public’s digital data.

The web giant is understood to be readying a new data storage service – thought to be dubbed “GDrive” – that would allow users to store digital files such as music tracks on the internet and access them via a web browser.

A spokesman for Google refused to comment directly on speculation that the company will launch the service in a matter of weeks, but said: “Storage is an important component of making web [applications] fit easily into consumers' and business users' lives.”

Last year Google inadvertently leaked a presentation memo that outlined its plans in data storage – moves apparently designed to make the hard drives installed on personal computers all but defunct.

“With infinite storage, we can house all user files, including: emails, web history, pictures, bookmarks, etc and make it accessible from anywhere (any device, any platform, etc)," it said.

Plans to extend Google’s reach over the public’s data is likely to spark renewed concerns from privacy activists who claim the company is already party to vast amounts of personal information. Concerns over data security escalated sharply last week when it emerged that the Government lost details of 25 million Britons in the post.

Executives at Microsoft are also likely to be wary of Google's plans. Analysts have argued that the long-anticipated GDrive could make it easier for consumers to abandon Windows, Microsoft’s dominant operating system.

Henry Blodget, the technology blogger, said: “The critical element here will be seamlessness: If Google forces users to go through an inconvenient "uploading" process, the product will be just another easy-for-Microsoft-to-duplicate [tool]

But Google has already invested billions of dollars in a fleet of vast server farms – the group of data centres or “cloud” that it uses to store information including the e-mails that pass through its Gmail service and documents created using its online word processing applications.

The company has made it clear that it believes the future of computing will involve consumers accessing software tools through the web, rather than using applications that are hosted on a computer’s hard drive.

This “software as a service” model marks a sharp departure from Microsoft’s dominant licence-based business.

The Google spokesman said: "Cloud computing is going mainstream. The applications people use every day, such as e-mail, photo sharing, and word processing, are moving to the web because it's easier to share and access your data from anywhere when it's online, in one place.”

Google already offers paid-for data storage services across applications including Picasa Web Albums and G-mail.

The spokesman added: “We're always listening to our users and looking for ways to update and improve our web applications, including storage options, but we don't have anything new to announce right now.”

In February Google launched Google Apps Premier Edition, a bundle of web-based applications including e-mail, a word processor and a spreadsheet that competes with Microsoft's Office, which includes the software stalwarts Word and Excel.

At the time, industry insiders said that Google had been quietly preparing for months to tap Microsoft's cash-cow. Keen to supplement its lucrative search business, Google has built massive data-storage plants, thought to be years ahead of those so far developed by Microsoft and IBM.

Times Recommends

• ‘Lame duck’ fear for FSA as chief quits
• Storm over bailout of EU's most ailing economy
• Northern Rock to drop 100% savings guarantee