Cloud based backup versioning

This is a question for those who use cloud based backup.

From my perspective there are three times when a backup is needed.
1.  Storage failure (it could be the server, the hard drive, raid array, whatever)
2.  End user deletes file.
3.  End user needs earlier version of a file.

I can understand solutions for 1 and 2.  Back up the files, then restore when needed.  But what about number 3?   Currently I use tape for backups.  I have daily, weekly, monthly tapes.  If someone needs a file as it was in September of 2013, I can restore it from the September 2013 tape.

How does online backup handle versioning of files?  Currently my company adds about 1.5GB of data every week.  But the total amount of changed files is 1GB/day.  

If you start the year with 500GB of data do you end up paying for 865GB of data at the end of the year for all the different versions of the file?  The actual dataset would be 575GB at the end of the year.

Does cloud backup support data deduplication for example?  If so then I think that our dataset would be considerably smaller.

Also, all the data is stored on a Windows server.
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HeneganISAsked:
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David Johnson, CD, MVPConnect With a Mentor OwnerCommented:
Windows server 2012 has file deduplication S2K12R2 has an improved version.  We use amazon s3 storage and older files go into glacier storage.  And you do pay for all versions uploaded (full file sizes not just the differences)
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