PITR - base backup question

From the following link:
http://www.postgresql.org/docs/8.3/interactive/continuous-archiving.html#BACKUP-BASE-BACKUP

Step 3 says to perform the back up.

    Does this mean a File System Backup of the Data directory?
OR
    Does this mean performing a pg_dumpall and backing up the dump file?

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Regards,
Richard Broersma Jr.

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