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How to develop cloud archiving services offerings

While the market for cloud archiving is small, companies in the space see customer demand. Learn three ways to add cloud archiving to your portfolio.

The cloud offers an attractive alternative to data and email archiving. Commodity infrastructure means low-cost storage for large data stores that must be retained (often for regulatory reasons) but are infrequently accessed. And cloud services make it possible for IT channel companies to offer archiving services without having to build the infrastructure from scratch. But as IT solution providers develop their cloud archiving services, there remains plenty to be decided.

George Crump, founder and lead analyst at analysis firm Storage Switzerland, explained: "If I was a reseller looking to offer archiving to my clients, my decision process would begin with, 'Will I build it or buy it?' It's the classic business decision."

He continued: "If I build it, I have [two] decisions to make in terms of internal infrastructure: What am I going to use for hardware, and what am I going to use for software? From a hardware perspective, you're looking at some type of object storage. The other part is the software, and this will be the front end that the customer will interact with. That's typically an appliance on-site and connecting to a cloud in the back end."

This is the approach that Pittsburgh-based Expedient took with its cloud archiving services. John White, director of product strategy at the managed and data center services provider, chose SwiftStack, a software-defined storage platform built on the OpenStack object storage engine. "SwiftStack is powering [our archiving services] with Expedient's touch and feel on top. It's our rendition of SwiftStack software," he said. Users interact with the platform via a Web interface, API or gateway.

Archiving is a tough market because it's not something that's wildly successful to start with. It's a small market today, for sure.
George Crumpfounder and lead analyst, Storage Switzerland

The alternative to building your own cloud is to work with a service provider that has already chosen a back end, Crump explained. For example, he said, Nasuni uses Amazon Web Services and Google Compute. In this case, the solution provider simply resells the archiving services, and margins are greatest around implementation services. "For some resellers, that's probably fine," Crump said. "It is not for the faint of heart to get into the cloud business. You're running a data center essentially at that point."

The third option available to solution providers looking to develop a cloud archiving line of business is white-labeling a provider's services. Crump acknowledged that there aren't many solution providers taking this approach. "At least off the top of my head, I'm struggling with who in archive would be a player in that market," he said.

That is due, at least in part, to the challenges associated with the market. "Archiving is a tough market because it's not something that's wildly successful to start with. It's a small market today, for sure," Crump said.

In addition, archiving is conventionally packaged with a larger primary storage offering, so it is not a standalone service that customers typically seek. "[Cloud archiving services are] something that needs to be sold, not something that needs to be bought," Crump said. "People aren't going to be [knocking on] resellers' doors saying, 'I need to have some of that cloud archiving.' That's the challenge there: The resellers have to convince the end customer that a), they should archive and b), the cloud is a good destination for that."

Michael Goldstein, president and CEO at LAN Infotech, a Ft. Lauderdale, Fla.-based IT consulting and services company, agreed that selling a cloud offering is a challenge. "Cloud is a challenge in general. It's the trust factor," he said.

However, LAN Infotech has not seen the problems Crump suggests among its customers. In fact, the company is seeing uptake of the cloud archiving services it resells from Mimecast. "We feel that customers have been much more receptive to [our cloud archiving services] over the past couple years. We've hit a spot where the answer used to be, 'Let's throw more storage at it,' but [even with more storage] we're losing our backup window because people are working all the time. Storage and email are growing exponentially. We were selling archiving over the past few years as a potential option, but it's becoming more of a requirement," Goldstein said.

Other resellers are seeing demand for cloud archiving, as well. "The demand came from the places you'd expect: Financial services firms or companies that were party to a lawsuit and had struggled through e-discovery and wanted to avoid the pain," said Kirk Averett, senior director of sales and marketing for Rackspace, which offers cloud-based email archiving.

"It fits a need," White said. "At the end of the day you've got to look for things that people are going to buy, and this is one of the things that everyone is struggling with: 'I have all this data, and I don't know where to put it.'"

Perhaps that is why cloud archiving is proving to be a relatively easy sell for some solution providers. "The interesting thing we found is that as we started bringing it up in sales calls as an available add-on, we started selling it to a lot of customers. At this point, I'd be hard-pressed to tell you which markets [we sell into] because pretty much any type of customer we sell to buys archive from us," Averett said.

"Even our online sales still have a high take rate. That, frankly, was a surprise to us, and it's only grown over time. … People have been signing up far beyond what we anticipated," he said.

White is pleased with the way Expedient's archiving business is growing, as well. "When I first designed the product, I didn't think customers would come to us just to buy archiving, but they are. Our solutions are offered via an a la carte model. Every solution is custom tailored for every customer. I thought it would be a lot more of a bundle package, but we have customers come to us just for their archiving needs."

Expedient wrote its own in-house quoting system, and every time a sales person quotes the cloud service offering, White gets an alert. "I have a whole lot of quotes out there where this is the only byline," he said.

Next Steps

Learn about opportunities around file sync-and-share products

CompTIA cloud report shows transformation in the channel

This was last published in March 2015

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Which cloud archiving delivery option makes the most sense for your business? Why?
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The file archive is most important for us because we have records for customers as well as non-disclosure agreements, and other legal documentation. File archiving can be difficult, but this makes it much easier because it is scalable and easily accessible.
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Well, if you don't resell another provider's archiving service, then you have to choose a suitable object-based software to implement for your own service or on your customer's premises. Most of the larger players in object-based archiving, like Amplidata (HGST) and Cleversafe don't show much interest in any customer not needing at least 500TB to 1PB from the get-go. Startups like Storiant (formerly SageCloud) look for customers who also need to archive 1PB or more for starters. Customers who are not in that "ballpark" won't be able to bear the capital cost of jumping into any of those archiving solutions. That presents an opportunity for archiving solutions from Cloudian and SwiftStack. Cloudian has fully implemented the AWS S3 API in their HyperStore appliances and software and can tier archive data to S3, Glacier or any S3-compliant storage cluster. SwiftStack is pretty new and has only recently implemented the use of erasure codes, which is a requirement when archiving data, as it is much less storage intensive than using replication. Cloudian and SwiftStack have much lower entry points in the archiving market. A Cloudian cluster can start with tens of TBs and grow to hundreds of PBs. Cloudian is also committed to developing a VAR channel to sell their products.
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