If you travel with sensitive files, Lenovo's ThinkPad USB Secure Hard Drive strikes me as an excellent approach to security. There are many secure external hard drives, but I particularly like the approach taken by this one.
For one thing, it uses very secure, hardware based, full disk encryption. Every byte on the hard drive is encrypted. This protects even against someone cracking open the drive and removing the platters.
I also like that the security exists totally in the device. That is, the security of this external 2.5 inch hard drive does not depend on any software running in any computer.
For one thing, this makes it less error-prone. Most importantly, it frees up the hard drive from any and all operating system dependencies. Windows, Linux and Macs can all work with the drive.* Windows XP users can be limited/restricted, there's no need for administrator level security. Windows Vista users will never see a UAC prompt for the drive.
To be clear, I have not used the ThinkPad USB Secure Hard Drive, so this is not a review, more a heads up. H Security, a division of security company Heise did a good review.
When you connect the drive to a USB port nothing happens, as far as the computer is concerned. But the drive detects the connection and stands ready to accept a password. Passwords can range from six to sixteen digits (OK, it's a pass-number rather than a password).
When a valid password is entered, then the computer has access to all the files on the drive. At this point, there is no more security.
The full disk encryption only protects things until a password is entered. After that, it's clear sailing. You wouldn't want to connect a ThinkPad USB Secure Hard Drive to a computer and walk away for lunch. Re-locking the drive, however, is very simple - just unplug it.
Another benefit of the drive security being totally self-contained is that it does not preclude additional software security. For example, individual files could be password protected using the software that processes the file (think Word or Excel). Or, folders could be encrypted using an operating system feature. TrueCrypt users, such as myself, can continue working with encrypted volumes just like we've always done.
Software running on the computer would not know or care about the full disk encryption and vise versa.
Keeping sensitive files on an external hard disk has other advantages. When traveling, there are places that a relatively small 2.5 inch external hard disk can go that a laptop computer can not. And, although they are larger than USB flash drives, an external 2.5 inch hard drive is probably small enough that it never has to leave your side.
The final thing that the ThinkPad USB Secure Hard Drive has going for it is that it looks secure. There is no missing the fact that it has big numbered buttons on the top for entering a password (the review at Trusted Reviews offers a lot of images of the drive).
If you deal with clients, and need to keep their files secure, the drive screams security. It both looks secure and is secure. I hope my accountant uses one.
Afraid of forgetting the password? The drive supports 10 different passwords. For good luck, you might want to make a password consisting of 16 totally random digits and store it in a safe place.
The worst thing about this drive seems to be the name. What is "ThinkPad" doing there? It may give people the impression that the drive is only for use with ThinkPad laptop computers, when the reality is exactly the opposite.
The drive comes in 160GB and 320GB capacities and you pay a price premium for the security. As I write this, the 160GB model was selling for between $140 and $180. No doubt, for many it's money well spent.
*When dealing with multiple operating systems, there is the issue of a file system. Using an external hard drive with multiple operating systems means that the file system on the drive needs to be understood by each OS. FAT32 should work with all the major operating systems and many, if not most, Linux distributions can read/write to NTFS formatted drives (not sure about Macs).