Network Attached Storage, I have the Synology DS215j. This drive is connected to my computer via wireless network, but I found that after some time the Time Machine would tell me my backup was corrupted and had to be redone. Maybe they fixed this issue, I'll try again soon. Used to work flawlessly to my Time Capsule.
I do this as well, to my Synology DS213j. I found that it was a bit more difficult to maintain multiple external drives for my MBA, my wife's old MBP and now her rMB, plus my PC. However, I'll backup to both an external USB and my NAS because while TM can now backup to multiple drives, The external drive can be taken offsite, like to a safe deposit box at my credit union. That way for any disaster, I'll have it available when I need it.
Like it was said before, buying storage (internal or external) is a hell of a lot cheaper than paying someone for data recovery (and I'm in the IT field), and when dealing with computers, you are no-where near as vulnerable as your closest single point of failure.
Don't back up your computer? you're screwed; single point of failure.
Have only a single backup? You're screwed; single point of failure. Deltas between your machine as it currently sits and your last backup may be too great and still lose data.
Relying on that single backup? If you don't test your restore, you're screwed; single point of failure. You're not secure with your backups until your last restore of that backup. If the restore doesn't work, your backup may be corrupted.
Relying on RAID? you're screwed. RAID is not a backup; if the controller controlling the RAID fails, you lose the RAID.
Have multiple backups? Great! If you're storing them at home, single point of failure. Though it's very high odds, but if you lose your home, you lose all of it, including your backups. Store one away from home.
If you want to be secure and safe your data, have multiple backups and keep at least one in a remote location. That way you'll always have access to it in case of any major emergency, from corruption on your Mac, to corruption of a backup, to loss of your home.
BL.