Online backup services do work, otherwise services like Amazon S3 which has thousands of regular users and business customers and with billions of files stored would not be in business. I use Dropbox and can personally attest that recovering 20 GB of personal files after a hard drive failure does work...

People just need to keep in mind and prepare for the fact that like anything, online backups are not 100% reliable...nor is any DVD, hard drive, USB drive etc. The whole point of being digitally equipped to survive is to have multiple layers of backups and tools at your disposal...this no different then having multiple and redundant tools in your PSK.