Next-Gen Storage Services on the Rise

A fresh crop of storage service providers (SSPs) has emerged to tackle the storage challenges that go with increased data volumes, compliance pressures, and reliance on Web services. But enterprise customers may be slow to get on board.

This week, Nirvanix, a startup founded this year in San Diego, emerged from stealth with a business-to-business Nirvanix Storage Delivery Service. Aimed specifically at integrators, resellers, and consultancies that specialize in delivering Web 2.0 applications to their customers, the service is based on a proprietary clustered file system that offers global namespace, load balancing, and an API for ease of integration.

"We're like Isilon or Panasas without investing in hardware... We are media focused and optimized," says CEO Patrick Harr (ex-McData, Preventsys, and Enterprise Partners Venture Capital). "We see a large shift from transactional data to user-generated content [in Web 2.0 applications]... Companies need persistent and responsive storage tuned for media."

At least one consulting company that offers a backup service based on Nirvanix says the startup competes favorably against Amazon's S3 service on two counts: The support is better, and Nirvanix offers its own file system.

"Each has its pros and cons," said an exec with the consulting company, who requested anonymity. "Nirvanix is more expensive, but S3 requires more work up front." The company in question currently uses both vendors' offerings.Nirvanix charges 18 cents per Gbyte per month for stored data; Amazon charges about 15 cents per Gbyte per month.

The incremental pricing model is a feature that marks Nirvanix as a next-gen SSP. In the old days, SSPs had contractual arrangements with their customers. They also had their own facilities. But Nirvanix, like other next-gen providers, operates its service in colocation facilities. Nirvanix also provides something older SSPs downplayed -- a service level agreement for customers with storage of 10 Tbytes of less. (Nirvanix has two other tiers of customers and other agreement options.)

Another company in the next-gen services space is announcing new software. Next week, Remote Backup Systems Inc. plans to enhance its claim as a supplier to next-gen SSPs by unveiling a CDP for its core software, RBackup.

RBackup is the mechanism by which RBS, like competitor Asigra, provides online backup services on a subscription basis to other companies that in turn offer their own services tailored to specific vertical markets or enterprise customers.

One such outfit, First Backup, chose RBackup because it offered some options for company services that weren't available with other platforms at the time."Open file backup and system state backup let us play in markets we couldn't be in before," says First Backup VP Bob Brainard. While he continues to use other products, he's made RBS software the basis for a higher-end service oriented toward resellers who are tailoring systems to verticals like health care, real estate, and HIPAA administration.

In another example of the rise on SMB services, a firm called XiloCore has just emerged as a separate entity from two IT service provider parents, AllConnected, a networking company in Simi Valley, Calif., and Connecting Point, a Las Vegas IT consultancy. The two have set up a separate company based in part on products from Compellent and Asigra. Their specialty is offsite backup and restoral for SMBs.

"We offer 48-, 12-, and even 1-hour RTO," says VP of marketing and sales Lester Keizer. XiloCore offers services throughout the U.S. Pricing for a full-featured backup service, including offsite restoral, starts at about $8 per Gbyte per month.

All told, it's clear that demand for storage services, particularly online backup, is on the rise. (See Managed Services Resurge, Arsenal Touts Rapid Restoral, and Iron Mountain Opens M&A 'Pipeline'.)

Further, several big suppliers intend to release backup services, particularly aimed at SMBs, within the next few weeks. Like the offerings listed above, these services may be sold through resellers or integrators, but they're geared to smaller companies with limited capex resources."There's new interest in 'storage in the cloud,' no doubt," writes IDC analyst Doug Chandler in an email today. "Adoption of 'storage-in-the-cloud' will occur with smaller businesses first, I believe, who face many of the storage challenges the corporations do, but have few resources to cope with them."

When it comes to storage services, enterprise ITers could be a holdout. According to Chandler, the cost incentive compared with owning their own backup hasn't been sufficient to get them off the dime. Also, restoral of large amounts of data over the wire is typically slow and uncertain. Before buying en masse, recalcitrant enterprises will need to be shown that services can be as cost efficient as in-house deployments -- and that they can restore data just as quickly.

Meanwhile, momentum behind SMB online backup services is building. While enterprises may get into the loop eventually, for now, it's not an issue to next-gen providers, who are just getting off the ground themselves. As they succeed, their focus may extend to raising the bar on services for larger firms.