The price of technology always tumbles. But it’s still incredible to me that something that cost me $250 for 2 gigabytes a decade ago now costs 29 cents per gig!

That’s what Western Digital offers with its new My Book Mirror Edition, announced today. I remember documenting the Lake Forest’s company other hard drive feats: Reaching 100 gigabytes in 2001, attracting fans with its 200 GB ‘Drivezilla” in 2002, and finally hitting the 1 terabyte mark (that’s approximately 1,000 gigs) last year.

The new external USB My Book includes software to automatically backs up photos, music, and other computer files. It’s called the ‘Mirror Edition’ because it has two drives — one to back up items, the other to back up the back up. In other words, it’s configured to be a RAID 1 system.

At $290 for the 1 terabyte or $550 for the 2-terabyte capacity, the My Book is, respectively, 29 cents and 27.5 cents per gig.

This isn’t the cheapest out there. By the time the drive is widely available in stores, prices are likely to drop. At the moment, another Western Digital My Book 1 TB drive at Amazon is $199, or 20-cents per gig. And a special at Buy.com this week advertised a 500 GB drive from Fantom for $69.99, or 14-cents per gig.

Prices continue to drop because of technology improvements and competition. While companies like Western Digital and Seagate Technologies still dominate in the hard-disk drive space, they’re competing with many small players who target a niche, such as laptop drives, portable drives or drives for large business users. But since Western Digital maintains its own manufacturing and assembly plants, it says that its costs are lower than the competition. That means it can pass the savings to the consumer.

Another money-saving benefit of the new drives, they use WD’s GreenPower technology, an energy-efficient system with better cooling and no fan so it consumes 33 percent less power than comparable systems (ie: save even more money electricity bills).