(from the Windows Administrator's Guide, page 75)

Files on Disk as Sequential Volumes (FILE)

This device type allows you to create sequential volumes by creating
files on disk storage. To the server, these files have the
characteristics of a tape volume. Unless sharing with storage agents is
specified, the FILE device type does not require you to define library
or drive objects; only a device class is required. FILE volumes can also
be useful when transferring data for purposes such as electronic
vaulting or for taking advantage of relatively inexpensive disk storage
devices. 
FILE volumes are a convenient way to use sequential access disk storage:

--You do not need to explicitly define scratch volumes. The server can
automatically acquire and define scratch FILE volumes as needed.

--You can also create and format two or more private FILE volumes using
a single command. The advantage of private volumes is that they can
reduce disk fragmentation and maintenance overhead.

--Using a single device class definition that specifies two or more
directories, you can create large, FILE-type storage pools. Volumes are
created in the directories you specify in the device class definition.
For optimal performance, volumes should be associated with file systems.

--When predetermined space-utilization thresholds have been exceeded,
space trigger functionality can automatically allocate space for private
volumes in FILE-type storage pools.

--
Mark Stapleton (stapleton AT berbee DOT com)
Office 262.521.5627