In a typical HSM scenario, data files which are frequently used are stored on disk drives, but are eventually migrated to tape if they are not used for a certain period of time, typically a few months. If a user does reuse a file which is on tape, it is automatically moved back to disk storage. The advantage is that the total amount of stored data can be much larger than the capacity of the disk storage available, but since only rarely-used files are on tape, most users will usually not notice any slowdown.
HSM is sometimes referred to as tiered storage.
HSM (originally DFHSM, now DFSMShsm) was first implemented by IBM on their mainframe computers to reduce the cost of data storage, and to simplify the retrieval of data from slower media. The user would not need to know where the data was stored and how to get it back; the computer would retrieve the data automatically. The only difference to the user was the speed at which data was returned.
Recently, the development of Serial ATA (SATA) disks has created a significant market for three-stage HSM: files are migrated from high-performance Fibre Channel Storage Area Network devices to somewhat slower but much cheaper SATA disks arrays totalling several terabytes or more, and then eventually from the SATA disks to tape.
The newest development in HSM is with Disk and Flash, flash being over 30 times faster than disk, but disk being considerably cheaper.
Conceptually, HSM is analogous to the cache found in most computer CPUs, where small amounts of expensive SRAM memory running at very high speeds is used to store frequently used data, but the least recently used data is evicted to the slower but much larger main DRAM memory when new data has to be loaded.
HSM is often used for deep archival storage of data to be held long term at low cost. Automated tape robots can silo large quantities of data efficiently with low power consumption.
Some HSM software products allow the user to place portions of data files on high-speed disk cache and the rest on tape. This is used in applications that stream video over the internet -- the initial portion of a video is delivered immediately from disk while a robot finds, mounts and streams the rest of the file to the end user. Such a system greatly reduces disk cost for large content provision systems.