Microsoft is readying an online storage service, called LiveDrive, just a month after Google leaked plans for tis own.

Any announcement would have to be seen in context of Google’s Gdrive project which was leaked in typical Google style last month.

The Gdrive project came to light after a PowerPoint presentation designed for financial analysts accidentally included details of the hosted storage solution. It’s not the first time commercially sensitive information about Google has found its way into the public domain seemingly by accident.

The Gdrive service is believed to be a repository for emails, photos, music and documents saved to the Google servers rather than locally.

Now Microsoft is believed to be working on a similar offering as part of its Live service currently in Beta testing in the United States.

Like Gdrive the Microsoft Live Drive service is being pitched as a remote repository rather than a back-up solution. In Australia, Telstra announced its PC Backup service via its Kaz subsidiary. As the name suggests the online solution is more focused on strict back-up rather than storage and bundles a number of tools and utilities to automate and make process more bandwidth efficient.

Both Gdrive and LiveDrive would compete with existing smaller players in the online storage space. Streamload for example offers a free service to store up to 25GB of data and then offers subscription accounts to accommodate larger disk requirements or bigger transfer allowances.

US News source IDG managed to obtain confirmation form a Microsoft spokesman, Adam Sohn, last week. Sohn said the project code-named (Live Drive) could be used to search and share files across PCs and devices with the Sharing Folders feature in Microsoft’s Windows Live Messenger e-mail chat client.

It would also allow users to synchronise folders based on technology Microsoft gained with its acquisition of FolderShare.