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Storage-as-a-service (SaaS) companies have changed how they operate compared to the storage service providers of the last decade. Is SaaS a good fit for your company's data?

Remember eStorage? It was for eBusiness during the eEconomy. Ten years ago, a bunch of storage service providers (SSPs) popped up, ready to store dot-com data. Not long afterward, most first-generation SSPs closed their doors when their new-age business customers went belly-up and more established businesses couldn't adjust to the idea of handing crucial data to firms just a year or two old. StorageNetworks Inc., perhaps the best known SSP at the time, finally gave up the ghost after its stock price dropped from $154 per share to less than $1.50. When the dust settled, most storage managers never wanted to hear from an SSP again.

Today, sporting a new moniker, storage-as-a-service (SaaS) companies have learned from the mistakes of their SSP predecessors. And a handful of well-established storage heavyweights, EMC Corp. and IBM Corp. to name just two, have made key SaaS acquisitions in recent years. SaaS is being driven by economic factors and IT realities that didn't exist a few years ago: an explosion of electronic data, compliance requirements, a tight rein on capital spending and stringent disaster recovery (DR) mandates, all of which are making storage services more appealing to small

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and large businesses.

"We're seeing an increased level of sophistication on the supplier and customer side," says Doug Chandler, research director, infrastructure services at IDC, Framingham, MA. "[SaaS is] a very dynamic market right now."

So what's changed? The following broad trends are making SaaS more attractive to small- and medium-sized businesses (SMBs) and enterprise companies:

  • Big, well-known storage companies, such as IBM and EMC, have established SaaS offerings

  • Remote-office data protection fits nicely into the SaaS model

  • New data encryption transfer technology

  • Different SaaS tiering offerings

  • Increasing difficulties in companies finding and retaining storage staff

  • Growing importance of laptop data protection services

This was first published in August 2008

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