Here is MY running out of space scenerio:

Over the 4th of July holiday weekend, my SAN ran out of space for backups. Becasue of this, the transaction logs began to grow. Eventually, they filled up the hard drives. Once this happened, DTS packages began to fail, due to the log files being full. When the DTS packages failed that load the databases, the file server that receives files from an FTP server filled up.

As you can see, we MUST monitor the backup device to ensure it has plenty of space! I have talked with the Vice President of our IT group about this situation, but he is deaf to my claims. I tell him databases ony grow; they do not shrink. We must plan ahead for growth!