Hot Spots: On-demand technology sized right for SMBs

Technology advancements such as deduplication and bandwidth optimization, as well as shrinking storage and bandwidth costs, are making online backup increasingly attractive for small- to medium-sized businesses.

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Shop smart and your small shop could find on-demand backup a great fit.


Small- to medium-sized businesses (SMBs) are challenged by many of the same data management issues larger companies face. Mandated reporting requirements and rapid growth, along with remote or mobile locations, mean SMBs struggle with geographically dispersed data and ediscovery requests that can tie up systems and staff. At the same time, many SMBs still depend on tape-based backup systems and often don't have a designated IT staff member who specializes in designing or developing backup and recovery systems.

The good news is that many small- to medium-sized businesses are discovering that online--or on-demand--backup and recovery can work for them the same way it does for small office/home offices (SOHOs) and individual consumers. These online backup providers offer more than a place to store data; they automate the transfer of files over a WAN connection to safe storage at a remote site.

Technology advancements such as deduplication and bandwidth optimization, combined with the declining cost of storage and bandwidth, are making online backup increasingly attractive to small- to medium-sized businesses. The opportunity to "upgrade" from local, tape-based backup without making a capital investment, coupled with the more predictable "pay as you go" pricing model for online backup and recovery services, is a way to justify the change. On-demand backup pricing is typically based on service-level and capacity requirements. Pricing plans range from $5 to $20 per gigabyte per month, although providers moving upstream from consumer-level online backup have more aggressive pricing plans.

On-demand backup can also reduce operational expenses. Freed from the burden of tape--and its associated handling, shipping, storing, scheduling, monitoring, upgrading and troubleshooting--more resources will be available for strategic initiatives.

24/7 staffing for SMBs
Sometimes software-as-a-service (SaaS) is used interchangeably with on-demand, but not all online backup solutions fit the SaaS model. SaaS involves sharing a scalable application (and infrastructure) with multiple tenants while keeping data separate--applications such as Hotmail and Salesforce.com are great examples. Call it what you want, but there are plenty of ways SMBs can benefit from on-demand storage backup and recovery, beginning with pricing.

Service-level agreement (SLA)-based pricing (combined with reporting to monitor trending) means fewer surprises for growing companies. Operating-level agreements (OLAs) used by on-demand providers describe the responsibilities of the vendor's internal support group. OLA definitions may be simple, but they can be important. Service contracts help set policies for volume limitations (how much can be transferred within a set time frame), and retention periods, recovery point objectives and recovery time objectives for various data classifications are typically spelled out.

In addition, on-demand services can provide the sort of 24/7 monitoring that many smaller shops can't afford. Additional benefits might include application-specific protection and expertise or a built-in disaster recovery plan. Archiving services and electronic data discovery may also be offered. Finally, many providers have certification in storage processes and methodologies and may be better equipped than your own IT team to set up storage policies with regard to compliance requirements and audits.

Of course, companies considering on-demand backup and recovery have to consider bandwidth; it will dictate how much data can be transferred and some SMBs may have to make an initial investment here to reap the benefits of an on-demand investment. And because most organizations cite backup or recovery performance as a major problem, there will be some apprehension about sending data over a WAN connection to a third-party site. A few vendors in this space now have "quick start" and "quick recovery" programs where full backup sets can be physically delivered on disk for initial setup and rapid full recovery.

Finally, online backup involves more than the hosted backup application. You need to consider the vendor behind the service offering. Ask yourself "How many data centers does the vendor have?," "What experience does the vendor have delivering a managed service?" and, most importantly, "How well have they performed for companies with needs similar to mine?"

Vendor landscape
Iron Mountain Digital has leveraged its brand and trustworthiness to expand into services, including offsite data protection, server and PC backup, and email archiving. Seagate Technology recently acquired EVault, which has specialized in ediscovery for the last decade. Recent entrant Symantec will deliver online backup services and a tape vaulting capability (the latter specifically for its Backup Exec customers who want to maintain onsite protection and automate the electronic transfer of tape copies offsite for disaster recovery purposes). Hewlett-Packard has an enterprise-class offering through a partnership with Asigra, which excels at helping its partners offer managed services through its service-oriented architecture (SOA). Another strong player in this space is Arsenal Digital Solutions, which has partnered with many of the major service providers and carrier partners such as AT&T. Companies such as Digi-Data and Nirvanix are providing fully managed storage offerings that can be used for backup or primary content. Finally, Berkeley Data Systems (MozyPro) and Carbonite are moving up from the consumer space and offering aggressive pricing--as little as $4.95 per month for up to 30GB of storage.

There are other issues that should be taken into consideration when evaluating an online backup vendor or product. Here's a checklist I would encourage SMBs to use when shopping:

  • Transferring and storing data efficiently. In addition to incremental backup, look for some form of capacity reduction, especially if pricing is based on capacity of data stored.


  • Speed. Look for a vendor that offers an alternative to WAN-based transfer to accelerate the initial full backup or full recovery.


  • Matching scalability. This is crucial; you want to partner with a provider or vendor that can match your firm's growth--capacity, nodes, sites, etc.


  • Disaster planning (DR). What's the vendor's DR strategy? How many data centers exist and how geographically dispersed are they?


  • Meeting industry regulations and compliance requirements. Is the vendor equipped to meet Statement on Auditing Standards No. 70 (SAS 70) and Sarbanes-Oxley (SOX) audits? Would the vendor be able to comply with an electronic data discovery request?


  • Clarity in service commitments. It's critical to have a handle on SLAs and OLAs. You'll want to make sure service objectives are discussed and benchmarks set.

For SMBs, the arguments for outsourcing backup and recovery technology are compelling. Round-the-clock monitoring and defensible SLAs should convince you but be sure to network with peers, ask vendors and providers for customer contacts, and arrive at any vendor meeting with a list of real-world requests for data you've had or can expect to have. Just as the technology is proving itself, so do its sellers have to work to convince SMBs that their data will be safe and accessible-- and at a price point that makes sense given all the companies vying for your attention.

This was first published in October 2007

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