external hard drive -- looking to buy?

i have a 250 gig rocstor firewire 400 external that i've used for pro tools.

now that i have a shiny new iMac and a Sanyo HD1000 camera i've been using iMovie 08 to create home movies -- i realized that the video files are going to take up a ton of space. i'm thinking of this 1TB drive: http://www.newegg.com/Product/Product.aspx?Item=N82E16822238061

i'm looking for a time machine backup drive and a media storage drive (iTunes and home movies).

i can use the 250 gig for a work drive

would that setup work?

what solution do you use?

can you use the time machine drive as a media storage drive as well?

thanks!