I recently installed Live Mesh here at home. You point it at a folder on your computer, and those files are copied / synchronized over the internet.
If you put Mesh on another computer, you can have those files synch'd there. Microsoft also provides 5GB of storage on the internet that is kept in sync, too. You can use a web browser to access those files from anywhere.
This isn't a new idea. Even Microsoft's Groove did basically the same thing, as did FolderShare (Which Microsoft bought), and DropBox, which was recently mentioned by Joel. It's done particularly well, though.
If you have more than 5GB, you can still sync the files to other computers, just not the Microsoft-hosted "Live Desktop". And get this: you can still reach those files at mesh.com because it takes care of funelling them there. Nice.
I pointed it to my "Documents" folder ("My Documents" in Windows XP), so now when I put a file in there on one computer, it's waiting for me on the others. I also pointed at my "Favorites", which is very convenient. I was using Google Bookmarks + Google Toolbar before, but I like this a little better.
My brother sent me a hard drive with all his photos on it, as an off-site backup. Now that I have Mesh, I've copied his data on to my WHS and added it to Mesh. It's too big for the Live Desktop, so I told it not to sync there. Then I made him a co-owner. He will point mesh at his copy. The delta will be kept in sync, so if his entire island burns down, he won't lose any data. My plan is to sync my data to him the same way. (Using a hard drive over USPS for the initial sync is probably quicker than DSL.)
I always wished WHS had federation; this gets us most of the way there.