Yes, online backup is expensive when compared to hard drive storage costs. We get this all the time from potential clients. Despite explanations of the differences and merits, online backup is not suited to everyone. It comes down to not only (or even) budget but data types.
When considering online backup it is important to try to put a tangible value on your data. Your home photo collection may have extreemly high personal value but no commercial value. It is therefore likely that you will choose to mind it offline. Your company accounts may represent a lower quantity of data and low personal value but high commercial value and therefore be suitable for online backup. The trick here is not to find a cheap or free online backup provider for all your data but to differentiate between personal non commercail data you should trust yourself to look after freey (rather than give it to someone else to "lok after" for free and high value commercial data you are prepared to pay to have someone else fully accountable for.
I work for an online backup company. I dont backup my home videos online as it would not be financially viable. I do however backup some critical photos, most text documents and all filtered email.

Backupanytime.com , offering secure Irish based online backup for UK business