Tip

Capacity on demand lowers storage costs

By Linda Gail Christie

Now as low as $0.25 per megabyte, the purchase cost of storage has been dropping 30% per year. However, according to Cahners In-Stat Group, the cost to manage a megabyte has risen to $3.50 per year -- reaching 91% of the cost of storing data. When asked about this trend, President and COO for storage service provider (SSP) Storage Access Technologies, Jonathan Castleman said, "I foresee a technology train wreck: When disk prices have fallen to a point where disks are free, but customers can't afford any because of the high costs associated with managing them."

In addition to utilizing SANs to reduce the costs of storage management, many companies are examining the advantages of moving less-critical data off-site to storage providers. "One of the biggest advantages of the SSP model is capacity on demand," Castleman said.

With the enterprise data center model, when a company reaches 80% disk capacity, they need to start looking at adding more capacity. "For every one terabyte of usable space, a customer typically buys 1.5 to 3 terabytes for protection and growth," Castleman said. "And then, they wait three or more weeks for delivery and installation."

"With an SSP, you can call at 9:00 a.m. By 9:05 a.m., you can have exactly the capacity you need allocated, eliminating the need to pay for extra capacity until it will actually be used."

According to Castleman, one of the main benefits of SSP

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storage is the fact that it's highly scalable. Adds Castleman, "Many companies, for example, bought extra space for Y2K testing and then were stuck with it. In an SSP environment, you can scale up or down according to demand, paying only for the capacity you require."

Castleman is finding that large companies have been slow to adopt the SSP model because of fears about losing the availability of business-critical data. "Companies are more apt to outsource non-critical data such as their e-mail and historical data first," he said. "As they become more comfortable with their SSP vendor, though, they start looking at other opportunities for offloading their storage management burdens to experts who can employ more efficient methodologies to reduce costs."

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Storage management tips are written by Linda Gail Christie, a contributing editor based in Tulsa, Okla.


This was first published in September 2000

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