AT&T Lures Storage Users

AT&T Corp. (NYSE: T) today announced that it is expanding incentives for its Web hosting program to include managed data storage services, with offerings primarily intended to let customers comply with regulations concerning data retention (see AT&T Expands Storage Services).

"Our Web hosting promotion was so successful, we're using storage to entice other customers to come our way," says Chuck Sanders, AT&T's VP of hosting and managed services.

AT&T says it will waive one or two months of service contract fees for customers who sign up before Dec. 31, 2003. Customers who have up to $20,000 in monthly recurring fees would get one month free if they sign up for a two-year contract, Sanders says. Users spending more than $20,000 per month would get two months free, again if they sign up for two years.

The move by AT&T indicates that -- after a period of deep-freeze -- interest in the storage service provider (SSP) model may be coming back. The sector suffered a setback over the last two years: After hundreds of millions of venture capital dollars were invested in SSPs, it turned out many enterprise users weren't interested in outsourcing their critical data assets to a startup [ed. note: imagine that!]. (See SSPs: RIP.)

Another proof point that SSPs could be on the rebound is that service provider representatives at a recent event in New York hosted by Byte and Switch and Light Reading said they were definitely looking to provide new kinds of managed storage services. In addition to AT&T, other service providers tapping this market include large carriers like Sprint Corp. (NYSE: FON), as well as specialized players like Arsenal Digital Solutions Worldwide Inc. and ManagedStorage International Inc. (MSI) (see Carriers Getting Hip to Storage).AT&T says its offering includes a variety of networked storage services, including off-site tape backup and recovery and managed SAN services with remote data replication and load balancing between two sites.

Specifically, the company claims its data storage services can help enterprises comply with, for example, regulations for storing email mandated by the Securities and Exchange Commission (SEC) and requirements for the use and transfer of electronic patient records under the Health Insurance Portability and Accountability Act (HIPAA).

In May, AT&T launched Ultravailable Storage Services, which is designed for disaster recovery and manages the network transport needed for remote data replication, backup, and recovery (see AT&T Puts Hands on SANs).

Overall, AT&T says its managed hosting services more than doubled last year. The carrier recently opened new data centers in Hong Kong, France, and Australia, bringing its total number of centers to 21 across three continents, including 13 centers in the U.S.

Sanders claims AT&T's data centers in New York and New Jersey "didn't miss a beat" during the power outage last month that affected large parts of eastern North America. "Not a single one of our customers had a second of downtime," he says.Todd Spangler, US Editor, Byte and Switch