From IT to Home Appliance

11:15 AM -- Last week EMC announced the bundling of its Retrospect and Mozy backup products with the Iomega external hard drive. With this announcement, EMC makes a bold leap into supplying the average consumer with its storage and storage software products -- products previously only available to businesses, both large and small.

The acquisition of Iomega by EMC in June of 2008 enabled EMC to move into the home appliance market. Iomega, a consumer-recognized quality brand name, has given EMC the brand extension it needed to enter our homes and provide what appears to be robust backup capabilities. Along with the cost of the hard drive, EMC will charge $4.95 per month for the backup services.

From a business perspective, this is a bonanza for EMC: more hard drives and software sold (profit margin here), and recurring revenue, albeit $4.95 per month (profit margin here too). Indeed, this will be a good business for EMC -- providing they do the consumer marketing required to address the global consumer market place.

From the contrarian view, one can ask, Is this drive and software and monthly service worth the price?” Other companies, such as Office Max, offer a one-time fee of approximately $100 for a complete system backup and then backup of changes thereafter. This seems like a reasonable approach. Of course, one must remember that there is no local external hard drive in the Office Max approach. Why is this important? Well, having the local external hard drive can shave hours, perhaps days, off a full hard drive/system restore in the event of a laptop or desktop PC failure.

According to EMC, Retrospect and Mozy will coordinate a speedy restore from both the local external drive and any data that is stored remotely in its backup data centers. What more could you ask for? OK, perhaps nixing the monthly service charge and factoring it into purchase cost of the external hard drive would be something to ask for.The Trainer Test Results: This entry into the consumer space by EMC helps to provide more choice... And choice is always good because no solutions is one size fits all. While EMC may not yet be a household name, it very well could be in the next two to three years.

— Tom Trainer is founder and president of analyst firm Analytico. Prior to founding Analytico, Trainer was managing senior partner at Evaluator Group, and has also worked at EMC, HDS, Auspex, and Memorex-Telex during his 30-year career in IT.

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