After the intial signin to the service, the user is presented with the Folders homepage, showing the 3 folder types that can be created, as well as some default folders and a storage capactiy meter. After creating your own folders, these will appear on your homepage too. My storage meter says 250MB for the time being the beta should have more.
This sounds like it could be useful for “normal” people as long as they do this correctly. What they need to do is embed this into Vista (somehow), ideally people should open “Computer” (formerly “My Computer”) and the Live Folder storage should appear right there. Ideally the Live Folders should act EXACTLY like a normal hard drive. Screens shots are included in the article, but unfortunately they are rather small and useless. Hopefully the beta for this will open up soon.
It is almost kind of important to mention that the rumor is Live Folders will offer 500MB of free storage. Let me mention that this is absolutely pathetic when you consider AOL’s Xdrive offers 5GB free, Mozy offers 2GB, and Box.net offers 1GB for free right now. This is ignoring the fact that Google’s rumored storage offering is going to be “unlimited”. Microsoft needs to offer a MINIMUM of 5GB of storage.
Wandering the Interwebs 
Click the screenshots to make them larger 😉
And yes, they need a client 🙂