OrbLive a media application by Orb Networks, is available for US$9.99 at the App Store.
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Since the iPhone has no SD card slot or anything similar, you're pretty much limited to a maximum of about 16 GB of onboard storage for music, photos and videos. The next generation of the iPhone may up that to 32 GB. But if you've been collecting MP3s since the dawn of Napster, 32 GB still might not be enough space for your whole music collection, let alone a handful of videos.
But with an iPhone (or an iPod touch, if you're in WiFi land), you've got a nearly constant connection to the Internet, and with an app called OrbLive, you can access almost any media file that's on your home PC, provided it's turned on (this app can't be used with a Mac or Linux PC, though Orb says it's working on that). If you can store it on your computer, you can get to it on your iPhone via Orb.
Mothership Recognition
After downloading the OrbLive app for the iPhone, you'll need to go to the developer's Web site to set up an account (no charge) and download the server application, which runs on XP or Vista. In order for the iPhone Orb app to access media from your PC, the computer needs to be awake, connected to the Web, and running its own Orb application in the background.
In the PC application, you can designate which files on your computer the Orb iPhone app will be able to access. Each function -- video, document, music, etc. -- is assigned its own set files from which it can draw content. You can make up new files, or rout it into existing files. Just designate the path in the configuration option of the PC-based application.

Once Orb is up and running on the PC, bring up the iPhone app, sign in for the first time (your sign-in info is saved), and you can access all the media in your designated folders, via either a cellular data connection or WiFi. Now you have access to videos, music, photos, documents, and even your computer's TV tuner, if you've set one up.
Musical Talent
For me, Orb's best use is for music. Sure, you can cram a lot of music into even an 8 GB iPhone, but if you've got a big collection, it means always having to cut some songs. What if you find yourself in a moment that simply requires the accompaniment of a tune that didn't make it in during your last sync? The horror.
Music playback is smooth on both WiFi and 3G networks. Fast-forwarding, rewinding and skipping to another song bring in some lag, but nothing too frustrating. Sound quality wasn't degraded to any degree that I could discern (Disclosure: I'm no audiophile, and I like my music loud, but I can still hear that ringtone that only teens are supposed to be able to pick up, so draw your own conclusions).
Video playback is a little more tricky. On a WiFi network, starting a video takes a few seconds, and there are occasional hiccups, though not enough to make me crazy. All in all, it wasn't much different than watching a video saved to the iPhone itself. On a 3G network, though, the lags and hangups drove me to give up after a few minutes (this is the case with most video apps for the iPhone -- WiFi's usually fine, but 3G's awful. It says more about the network, perhaps, than the app). In both cases, video quality looked a little condensed.
The video player's fast-forward/rewind slider was hit-and-miss -- sometimes I could move forward and back in a video file, other times touching the slider would just take me back to the beginning of the show.
Getting video to the iPhone through Orb saves you the tedious step of having to convert video files into an iPhone-friendly format. Orb Networks says "If your media plays on your home PC, it will play in OrbLive on your iPhone or touch," but elsewhere they hedge that claim with a strategic "virtually." Personally, I had trouble getting it to play a video that I had purchased from iTunes, but any other format I tried worked just fine.
Photos and documents came through fairly quickly in both 3G and WiFi. The photo viewer has the same swipe-to-move feature as the iPhone's own photo display, but I couldn't pinch and spread to zoom in and out.
Wake Up!
Using Orb might take a little planning. You have to make sure your home PC has Orb up and running while you're out using it (it can be set to automatically run when you start up Windows). You also have to negotiate the proper sleep settings. Orb won't work when your PC is in sleep mode. There's an option on the iPhone app to wake up the home PC, but that doesn't always do the trick. If you can't get your PC out of bed remotely, then using Orb on the go may require you to turn off sleep mode entirely.
Privacy is also a consideration. For one thing, your password is automatically saved in the app to facilitate one-touch sign-on. If you lose your phone and someone grabs it before its PIN security setting kicks in, he or she could easily snoop around in whatever files you've opened to Orb (until you get home and shut down the PC app, that is). If that troubles you, you can always just erase your saved password from the settings menu every time you shut the app down. Still, an "always ask for a password" option would be a good improvement for developers to throw into a future update.
Also, companies that connect you to your own data usually swear up and down that nobody's looking, prying, snooping or otherwise eavesdropping. That might be a common official policy, but it's up to your whether to believe that nobody ever actually peeks.
Bottom Line
With all the other things the iPhone can do, it's natural to want to use it as your universal, watch-anything-anywhere media player as well. However, its space limitations and lack of expansion options hold it back in that regard.
OrbLive attempts to overcome this by connecting you to your home base via the Net. It's a little clunky at times, but when it works (which it does very consistently when it comes to music), I'm glad it's there.

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