Really cool stuff... (Score 1)

Actually, you are really close to correct. This technology is essentially a means of focusing light beyond the wavelength limit. The spot size of a focused beam is limited to the wavelenth of the light in question. this means that optical spots are forced to be fairly big. If you plkay some tricks with teh head design, though, you can overfocus the light. If you want to learn more, there's lots of neat information on the subject. Look up near field scanning optical microscopy. Unless I am really confused, the two techniques are essentially the same.
As for data limitations, I thought terrastor's process was essentially temperatuer enhanced magnetic field recording. As far as I ever heard (and I admit, I didn't pay too much attention) there was no proof, ever, that what they did was really near field R/W. Perhaps it got fixed. As for the long term use, I think hard-drives still have a few years. There are some technical limits (namely the paramagnetic limit), but terrabyte high speed drives are certainly doable. Anyway, thats my two cents