What Is the Cloud Storage Market?
Cloud storage solutions emerged from the utility computing model, in which defined services depend on standardization and customer satisfaction depends upon optimization of those defined services. Players include low-end providers such as EMC’s Mozy, which offers online backup to the home/individual/small business market, and Dropbox, which enables users to store files in the cloud and synch them between home and work. Cloud storage options for SMBs include Rackspace’s Cloud Files, Nirvanix, or ElephantDrive, which stresses security. Enterprises will likely turn to Rackspace, EMC, Eucalyptus, and traditional IT stalwarts Red Hat, IBM, HP, and Microsoft.
The cloud storage market is huge and growing. More important than compiling a long list of cloud storage providers is determining how an entrepreneur or business should evaluate cloud storage providers, many of which began life as hosted IT services providers (e.g., Rackspace). Obvious measures include cost, market size, and niche, but among the most important variables upon which to base a decision are reliability and security.
Reliability and Security in Cloud Storage
At its most basic, reliability in the cloud is the same as reliability in an enterprise data center: Policies and processes must be in place to ensure uptime, adequate resources must be provisioned, and reliable and proven backup procedures must be in place – and audited. Then there’s BC and DR – business continuity and disaster recovery. This capability is a given in the enterprise, where “hot” site data centers are mandated and must be ready to handle failovers to avoid data loss and business interruption. For small entrepreneurial businesses, having a hot site is a nice-to-have but likely out of budget.
For entrepreneurs and SMBs especially, cloud storage is taking off. It’s crossed the chasm because it offers a reasonable price/data availability tradeoff for various sectors – e.g., financial services, e-commerce, health care, and government (we analyze costs later). One author reports that 68 percent of enterprises have adopted cloud storage . For many entrepreneurs, the bar is somewhat lower: Unless you’re in a heavily regulated market, cloud storage is a convenience, not a risk.
Security is still an issue for some. A recent Management Insight Technologies survey sponsored by CA  notes that security and business unit managers, in particular, are concerned about security in the cloud, especially public clouds. Enterprises and mid-size businesses that have adopted virtualization will follow the path of virtualization into the cloud, first placing noncritical applications and data in public clouds and keeping more critical apps and data in private clouds until security models are proven. Questions about regulatory compliance will keep some differentiating applications from moving to the cloud.
Other Cloud Attributes
We believe a set of attributes can help entrepreneurs determine what is or is not a cloud service:
[In the next segment, Bob addresses open issues with cloud storage and the potential of cloud storage adoption.]
 Black, Lee, Mandelbaum, Jack, Grover, Indira, and Marvi, Yousef: The Arrival of “Cloud Thinking.” Register for a copy here: https://www.ca.com/us/register/activity.aspx?cid=117603