I quit on incremental backups long back. Disk space is cheaper than it has ever been and there are too many ifs and buts involved in incremental backups for me to feel secure about them. I have been using Powerquest's Drive Image (yes, it's ancient but it hasn't let me down once in all the years of frequent use) for my image backup needs. I tend to create images every month more or less and have at least 2 previous images on my HDD at all times.

BTW, is Acronis True Image worth it? I have two main doubts regarding True Image:
1. Are the 'Live Backups' the ones I create with my programs running and accessing the drives being backed up absolutely reliable?
2. Will I be able to restore from DOS without any special boot disks? With Drive Image I can boot using a Win98 boot disk and restore the drives (the images and Drive Image program files can be on removable media or a non-target partition on my HDD).

Last question - how do True Image and Symantec Ghost (which is the descendant of Drive Image) compare? Reliability is obviously my first priority, followed by functionality.

I always make it a point to backup irreplaceable data online. Hmm... am tempted to start a 'describe your backup setup' thread now...

My point wasn't that it never happens but that it's rare and I don't see any signs that it's going to become so common that commercial software ceases to exist.

You seem to have substantially changed your stand now. Either you're extremely naive or you're simply in denial if you think good freeware that does more than one or two things is a rare commodity. I could give you a list of top notch freeware apps on my system that are as good as or better than any commercially available software.

Azureus and Utorrent are damn good programs that perform complex tasks and perform them well. They are not too simple to be sold commercially. That category of software is already dominated by freeware and commercial stuff doesn't even stand a chance. I can see a lot of people shelling out good money for sturdy P2P clients had they not already been free. The same story is repeated in the web browser category.

I wouldn't categorize Firefox as a simple software that just does one or two things either, it's the most used app on a lot of PCs.

Go to any freeware site and you'll see tons of apps in any given category. At least a bunch of these are going to give commercial ware a tough time in the future! 

I'm sure a lot of folks on this forum will be able to mention great free IDEs that they use for developement. Is a program that compiles code and creates executables a simple app by your definition? No? Is it just another exception then? Wait a sec! We're seeing quite a few exceptions here... maybe it's the rule rather than the exception.   

There will always be commercially available software in the foreseeable future but there will also be a strong free alternative hot on its tail. The only way commercial software can stay ahead is to steadily improve in quality or to slash their prices. I see the technology/quality gap narrowing so there's only one way for the prices to go.