Legato Mines Iron Mountain

Legato Systems Inc. (Nasdaq: LGTO) has inked a licensing deal for its email archiving software with Iron Mountain Inc., the latest sign the industry is rapidly mobilizing to address the needs of managing massive amounts of email.

The deal follows a similar one Legato announced this week with Hewlett-Packard Co. (NYSE: HPQ), which will resell Legato's EmailXtender message archiving software (see HP to Resell Legato Email Archiver).

And next week, HP plans to announce a partnership with Sector Inc., a division of the Securities Industry Automation Corporation (SIAC), to offer the financial industry outsourced email archiving services based on Legato's software.

"Clearly, we're getting more visible momentum, though it's still a young market," says George Symons, Legato's CTO.

Boston-based Iron Mountain, which is best known for its off-site document and tape vaulting services, will incorporate Legato's mailbox management technology into its enterprise email management services. Iron Mountain says it will provide customers an "archiving rules engine" that can selectively target email that needs to be archived and then automatically migrate those emails and attachments from the original email servers to Iron Mountain's off-site data center.Legato EmailXtender -- which it obtained with its acquisition of OTG Software last year -- works with Lotus Notes, Microsoft Exchange, Unix Sendmail, and Bloomberg Mail to transparently archive old messages and reduce the disk space required by storing just one copy of attachments sent to multiple recipients. It also allows users to perform a full-index search of messages and attachments across the entire message store (see Legato Ropes In OTG).

Dave Hill, VP of storage research at Aberdeen Group Inc., says it's critical to have that archival process automated.

"You have the issue of, 'When I should throw stuff away and when I don't throw that stuff away,' " he says. "It becomes very difficult for organizations to manage this whole process without forcing the user to decide what they want to keep or delete."

Meanwhile, on another front, Iron Mountain last month announced that it will offer instant message archiving services, partnering with IM providers Akonix Systems Inc., Communicator Inc., FaceTime Communications Inc., and IMlogic Inc. (see Iron Mountain Archives IM).

Others aggressively targeting the email archiving market include EMC Corp. (NYSE: EMC) with its Centera disk-based archive system and Network Appliance Inc. (Nasdaq: NTAP) with its NearStore system. Legato's EmailXtender is also integrated into Centera (see Legato Supports EMC Centera and NetApp Adds WORM to NearStore).What has all these vendors scrambling for a piece of the action? Analysts say government regulations in a variety of industries are putting new mandates on what data records businesses must keep on file. Specifically, Securities and Exchange Commission (SEC) Rules 17a-3 and 4 require financial firms to retain all records -- including email and instant messages -- in some cases for up to six years. The 1996 Health Insurance Portability and Accountability Act (HIPAA) places similar data-retention requirements on healthcare organizations.

Enterprise Storage Group Inc. says such regulations are opening a new window of opportunity for storage vendors, especially those that come to market this year with SEC-compliant storage offerings. In a new report, the firm predicts the worldwide opportunity for compliance-related storage solutions, software, and services will exceed $6 billion over the next four years [ed. note: give or take a couple billion!].

"SEC-compliant record archiving and retention is now a pain point at the highest management levels in financial services firms," the ESG report says. "This pain is often compounded by a general lack of awareness of the issues that need to be addressed."

Todd Spangler, US Editor, Byte and Switch