Engel previously founded Concord Communications Inc., a network management software startup purchased by CA, Inc. two years ago. He spent the last two years retired from the IT industry, spending his time working with an investment group in Providence, R.I. Engel said he was beginning to plan another new business, this time focused on storage, when Iron Mountain approached him to build its digital business instead.
What is the state of Iron Mountain Digital as you're coming in to it? How many employees does the division have at this point? What about customers and revenues?
So you're looking to expand archiving, but the backup business is off and running?
Fred Engel: Well, both. We're looking to get into new areas with the backup business, so there are a bunch of things we're trying to do there. We bought [intellectual property assets belonging to the privately held, Framingham, Mass.-based] Avalere in May, and they extend what we can do in data protection, because now we can protect documents, we can understand where the documents came from, what kind of documents we have, which can lead to a much more granular data protection for policymakers so they're not just backing up everything they've got. We're trying to extend what it is we think that data protection can be.
Clearly the archive is also part of that. Over the last six weeks as I've started to get involved in the partnerships and the businesses we're working with, it has become apparent that the integration of all the pieces within Iron Mountain is something we have to do. The CIO doesn't want to distinguish or deal with different people when they've got a problem with some documents on paper, a bunch of tapes that need to be stored, some need to be online, some not … they basically have an archival problem.
And it is an integrated problem -- the customer isn't going to want to have everything online. That's where I think that we offer a good opportunity for the customer. Very few people have the capacity, the understanding, the technology, the consulting group and the software to help people really manage retention.
So how does Iron Mountain plan to compete against Google and Postini, Symantec and EMC in the Storage as a Service market?
Fred Engel: The issue [with archiving] is that it's not just storing data -- there are laws and rules for having certain documents readily accessible, procedural rules for dealing with law enforcement and requests for evidence. The advantage we have is that we're not an unknown in this area. We already have a consulting group with knowledge of what's required, and we have the ability to execute on that knowledge. We've already been working with hospitals on HIPAA compliance, for example. That's a big market for us.
So we have those processes, and we're trying to infuse technology into that, while one of the barriers to entry for our competitors is those processes. What we have to do is show the market we're a viable player in technology, and I think Iron Mountain has come a long way and done a lot of work the last couple of years putting the technology together. As CTO, I thought there was an interesting opportunity here to consolidate that, to take the engineering discipline of a bunch of companies and put it together in a way that's credible to the marketplace.
Not being an unknown could be a disadvantage as well. Data security and the security of Iron Mountain's facilities are big issues for users, especially recently. How will the archiving business address those issues?Fred Engel: I think the Iron Mountain brand is still very strong. To make the digital business secure, we now have a security architect in charge for Iron Mountain. We've always had a security group for audits and another group doing external verification, but there's now someone designing our overall security, and that's his only job. Also, we make sure we have redundancy in our systems and operations personnel in tune with security. There are a bunch of moving parts there.
When you take data that is on the customer premise today, one of the ways to send it off is via tape, and we have different services at Iron Mountain, including a premium service that's very secure. But you'd like to be able to take that data, and without human intervention because with that comes human error, from the premises and move it to our archive in a way that eliminates the possibilities of data loss with a secure chain of custody. We would like to automate that so that it can flow over wires into an archive and never have to go anywhere else. We know that business, we're in that business today. We don't have to learn how to do it. We're just automating something that we already do.
What further automation is going to be added?Fred Engel: Right now we already have a piece of software called Retention Center that helps people understand from a compliance and legal perspective what are the right things to do relative to holding on to documents -- when can you store them, where can you store them, which ones do you have to store for how long, and when can you destroy them. We've also automated the application of those policies and policies around e-discovery, compliance and litigation to documents. The need to deal with those policies is what we'll continue to automate over time. And then we want to be able to index these things more easily, so that if someone decides to store something on a tape, that we know what's on that tape and can make it easier for them to do something with it.
Also, if you look at the technology we already have [with LiveVault], it involves the ability to take data off of someone's hands in a reasonably automated fashion. We already have very good mechanisms for bringing in the data over the wires to our servers and keeping storage as a service for those customers using our Connected and LiveVault services.
That makes it feasible to think about archiving over a network. You can apply the kinds of [data reduction] technologies that we've applied to Connected and LiveVault to the archiving problem, then all of a sudden it becomes feasible to think about sending data over network wires that are not exorbitantly expensive. Those are some of the things we want to solve. We've solved some of them already with Connected and LiveVault, but with archiving the total volume might be more, so we have to go and figure that out.