This equates to storing 25 million pages of data on a surface the size of a postage stamp, or 15 Gbytes into a wristwatch-sized device, IBM said.
The system - codenamed Millipede - does away with magnetic or electronic means of data storage. Instead, Millipede uses thousands of sharp molecular-size tips to punch indentations representing individual bits into a thin plastic film. The indentations are just 10 nanometers, or millionths of a millimetre, in diameter. The technology used resembles that used in the atomic force microscope, invented in 1986 by IBM researcher Gerd Binnig, co-designer of the Millipede technology.
While resembling a tiny punch-card system, Millipede indentations can be erased and rewritten a large number of times - tests have involved hundreds of thousands of write/erase cycles, IBM said.
Punch-card technology, invented over 110 years ago, was used to tabulate the results of the 1890 US census. The new Millipede nanotech punch cards can pack 3 million bits into a hole the size of that used to store a single bit in the 19th-century version.
Millipede technology, developed at IBM's Zurich research laboratory, could begin replacing existing silicon-based flash memory cards in handheld computers and mobile phones by the end of 2005 although IBM said it has not yet decided on plans to release products based on the Millipede technology.