That's all i use - external HDD - 2 of them, alternating. I've had CD's rot out after 6 years. Every year, at Xmas time, I do the Great Media Conversion - for $200 a year, I buy whatever the biggest USB drive there is for $200 and then copy EVERYTHING over to it, and then add from there. Eventually the smaller drive can't keep up with the data, by then it's time to buy a new drive. Currently, I'm running a 250GB and a 160 GB La Cie, they are identical in content. The 160 GB is being replaced this month with a 500GB Western Digital, which I've seen in the range of $200. Eventually, the 50GB drive will be "small" and will be replaced with a 1TB drive and so on.
This is just one of those chores like chainging the oil.