Egnyte in the News

"7 Small Business Storage Trends in 2011"

By Drew Robb

January 20, 2011

Small Business

It seems like only yesterday that a one gigabyte (GB) hard drive was considered massive. These days, half a terabyte (TB) is the norm, even for small businesses. Here's a perennial trend you can count on: you will always need more small business storage.

"SMBs are seeing 50-to-70 percent annual growth in storage," said Eric Herzog, vice president of product management and marketing for EMC's unified storage division. "Simple, easy-to-manage and high-availability storage is increasingly important."

While the continued explosion in capacity dominates, there are plenty of other trends that will affect small business IT in 2011. We outline seven of them.

1. Cloud-based Storage

One trend that everyone agrees on is that cloud computing is a good medium for small business storage. Here three small business storage experts - two analysts and one cloud-computing vendor - share their perspective:

"Smaller firms will look at cloud-based services as a way of reducing their IT spending by outsourcing specific IT services," said Mike Karp of analyst firm Ptak, Noel & Associates. "Good bets include archiving and e-discovery, which is increasingly called for in legal cases."

"Small businesses will start using cloud-based storage more and more for active data stores as well as archival and disaster recovery," said Vineet Jain, CEO of Egnyte, a provider of cloud file server solutions.

"Look for continued adoption of cloud backup as budgets will remain tight and companies will need to do more with less," said Greg Schulz, an analyst with StorageIO Group.

2. Cloud Sophistication Grows

What is the cloud? It is a collection of computing resources (scattered across multiple locations) that can be pooled together and managed as one unit. Users typically purchase, via monthly subscription, the amount of disk, processor or memory they need, or else they receive a specific service, such as online backup or archiving of aging data.

More small businesses are using cloud services such as Google Docs and Amazon EC2, but even more sophisticated tools are coming on the market such as those offered by Egnyte and Zetta.

Egnyte provides super-fast speeds for large data uploads. The company currently stores more than five billion files in its cloud network. Egnyte systems process more than one million file operations (uploads/downloads) every 10 hours.

Zetta, on the other hand, acts as an alternative to building expensive offsite storage for data protection purposes. While the big boys may have the funds to build a remote data center and keep an extra copy of all vital files, few SMBs can even consider it.

Zetta makes the cost equation more affordable by outsourcing this function. According to Jeff Bell, director of corporate marketing at Zetta, it would cost about $350,000 to protect 10 terabytes of data offsite as opposed to a little over $100,000 using his company's service.

"There are no upfront capital expenses, no backup software licenses, no removable media cost, and no complexity or risk," said Bell.

3. Cloud Computing and Virtualization

The cloud is really an extension of virtualization technology. Instead of a single server being virtualized, however, the cloud represents the virtualization of a large group of computing resources or an entire data center. But virtualization is proving hugely popular with small businesses, many of which have little or nothing to do with the cloud.

"We have noticed a steady move to virtualization by SMBs in order to consolidate their servers or virtualize their desktops," said Herzog. "That is leading them to deploy storage that is also optimized for virtualization."

4. Network Storage

Small businesses are famous for having user files residing on PCs. As they get larger or more sophisticated, they might add a file server where everyone stores files. But ever-expanding data requirements are leading more firms to consider networked storage which has traditionally been the province of larger enterprises. This approach offers a far greater amount of space that you can pack into a file server.

"The trend toward easily managed network storage will accelerate as smaller businesses begin leveraging the capabilities that centralized storage offers," said Karp. "SMBs that want to keep their storage in-house will base storage-buying decisions on reliability, ease of management, and on finding the best pricing possible that meets those requirements."

5. Decreased Storage Complexity

As enterprise-class storage filters down the food chain, it tends to be adopted first by tech-savvy firms who have enough internal IT resources to understand and properly configure systems. At a certain point in the adoption curve, though, the storage vendors start to comprehend the value of the SMB market and begin to redesign and simplify their products to suit a new set of customers.

Thus, what we see now is a big reduction in the management complexity that used to accompany networked storage and traditional storage processes.

"There is no room for cryptic storage jargon in SMB storage," said Herzog.

The latest batch of products, for example, is far easier to operate than their relatives from a couple of generations back. That doesn't mean that the boss can use them -- unless he or she has some level of basic computer knowledge.

Typically, an IT generalist -- someone who perhaps looks after backup, networking and troubleshooting on a part-time basis -- should be able to operate modern small business storage tools.

6. Channel Partners and Value-added Resellers

While the products are simpler, SMBs might have trouble evaluating various competitive offerings and determining which one is right for their specific business. That is where value added resellers (VARs) and system integrators that sell and/or deploy computer systems from various manufacturers come in. Oftentimes, a reseller will focus on a particular vendor such as EMC, HP, or Dell.

"As smaller companies lack IT resources, they rely on their channel partners to supplement and complement whatever IT resources they may have," said Herzog. "Selecting the right reseller is important."

Karp concurs. He sees SMBs using the channel in greater numbers in order to make smarter technology investments. "Successful VARs will craft offerings that are reliable, easy-to-use, and aggressively priced," said Karp.

7. All-in-One Small Business Storage

You'll find that all-in-one storage offerings, which are gaining in popularity, contain most of the trends we've mentioned so far. They're generally easy to use, harness virtualization technology, include some aspect of networked storage, and the storage vendors and VARs work together to get the products and solutions in place.

This approach unifies several aspects of storage and networking to reduce the number of systems that a small business needs to buy, operate and maintain -- a real value proposition. Many storage vendors now offer these unified storage systems.

Take the case of First State Bank & Trust in Kansas where file servers had multiplied to the point of being unmanageable. These servers ran all kinds of banking systems including applications, check imaging, remote deposits, customer inquiries and online banking.

The bank turned to Choice Solutions, a systems integrator, to deploy Axiom storage from Pillar Data. They virtualized multiple physical servers, which resulted in greater storage capacity at a much lower cost.

"Most competitors specified several boxes as opposed to the unified setup from Pillar Axiom," Harry M. Wheeler, Jr., senior vice president at First State Bank & Trust. "We saw value in the concept of consolidating our storage onto a single platform to support our virtualized environment and to keep pace with rapid growth."

The unified storage system meant that First State Bank & Trust didn't have to hire a storage manager who understands the intricacies of networked storage. Instead another IT staffer oversees the system using its set-it-and-forget-it features.

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