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Hook up a formatted drive to the Extreme, then configure it as your backup drive in Preferences > Time Machine. It's quite straight-forward, although I'd recommend connecting the HD to your machine directly if you have no plan on sharing it (the HD).
No personal experience with that but it may not be a great idea: http://pondini.org/TM/Airport.html
Thanks. Suddenly a NAS might make more sense.
Unless you want to spend a decent amount of money, consumer grade NAS isn't that great an option (been there, done that). What, exactly, are you trying to do? I use local drives for backup, which are then backed up to Crashplan+ (the family plan), which allows me to do incremental offsite (cloud) backups. The free version allows you to backup to your local machine (including external drives) as well as to other machines on your network. It's very easy to use and is quite robust.
I need to read about the initial backup as 2TB of music will take a long time to backup over online.
What should I do, if I have more than a TB to backup?Fill up your 1TB drive full, then ship the drive back to us. We'll upload your backup to CrashPlan Central really super fast. Your backup will automatically continue, so that everything else selected for backup will be added to your archive. Still saving you a lot of time.
MikeCan it backup the whole drive or just certain parts?
Yes.
Right. I use Carbon Copy Cloner for bootable drives.
No personal experience with that but