Storage vendors look to agile hosted services model

In the wake of CRM vendors embracing hosted services, storage providers are now heading in the same direction launching agile, on-demand-style offerings that can replace the need for capital outlays on costly infrastructure.

With budgets shrinking and storage requirements growing, IDC's Asia Pacific associate vice president for storage Graham Penn believes these new customized, hosted storage offerings will be very attractive to IT managers.

"Considering budget restraints and the difficulty in finding the right storage skill sets, this will solve a few IT manager headaches," Penn said.

"Of course, it depends on what budget you're talking about, either capital or operational, but monthly payments to a provider could be a lot more attractive than one large sum paid out every year.

"Storage can be a significant expense, and that's not just the cost of the equipment, but also the cost of paying people to manage the data."

Penn estimates data capacity requirements at most organizations are growing at a whopping 45 percent per annum.

But despite these pressures, Penn said there are still some big hurdles that storage vendors will need to overcome.

Not all organizations, he said, will willingly let go of their data.

"I think one of the big issues in this area will be the willingness of companies to let data get out of the building; it really becomes more of a security issue than anything else," he said.

IDC senior end user analyst Peter Hind described data as the lifeblood of an organization.

Hind said there is a very real element of concern about a third party storing data.

One vendor leading the charge to hosted services is Hitachi Data Systems.

The Asia-Pacific arm of the company is 18 months ahead of its US counterpart, this month announcing an outsourced data storage solution.

Tim Smith, A/NZ marketing director at Hitachi Data Systems, said the company has made a significant investment in hosted storage offerings.

"Medium enterprises were telling us that they felt their information was just as important as a bank's, but they couldn't justify spending the dollars," Smith said citing the Flight Centre as an example of its new hosted client list.

He said companies are more than willing to trust a third-party with their data.

"Our data centres are more secure than a normal corporate office," Smith added.

StorageTek managing director Philip Belcher is also a supportor of hosted storage offerings.

Although the vendor does not offer these services directly, it provides partners with the equipment for hosted services.

"If you're a relatively small IT shop it can make a lot of sense to look into hosting certain information externally," Belcher said.

"I think hosted offerings is a growing trend, but people need to think carefully about implementation, whether to go partial or simply outsource their storage completely."

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