Nearly a year ago it was clear that online storage services were a becoming a top strategic priority at several leading companies. With pricing today for data protection services at roughly $5/gb/month, headed to $2.5/gb/month in the near term, things are beginning to heat up -- but much remains unclear. EMC's recent acquisition of Mozy and IBM's move to bring in Arsenal Digital are just two examples of leaders intent on muscling in and/or not giving ground in this marketplace. Indeed, every major storage supplier will be forced to participate in this space either through acquisition, strong partnerships, or homegrown offerings.
How much this business is driven by consumer trends remains to be seen, but betting against the consumerization of storage services is probably a bad idea as SMB's will define the market. Moreover, with Dell's commitment to storage sealed with its recent acquisition of EqualLogic and the company's installed base of several hundred thousand SMB's, the marketing hype is just about to explode.
The requirements for this market are straightforward. Offerings must be simple and transparent with rock-solid reliability.
Action Item: Storage providers must get serious about on-line storage services in general and data protection services specifically. Suppliers must aggressively adopt software-as-a-service (SaaS) models and drive price/usage transparency, simplicity, and an always-on reliability. Marketing messages will become a key differentiator and source of customer value as free trials, bronze/silver/gold service granularity, and 'it's your data' messages will permeate the industry over the next 6-12 months.