This is an opportunity for resellers to dispel beliefs that cloud storage is dangerous and perhaps offer a simple program to ease companies into online backup, or use a combined program of onsite and offsite backup.

For those SMBs that do utilize online backup, 70 percent of them also have a network attached storage (NAS) unit, according to recent data from In-Stat. XZ Backup offers both onsite and offsite storage, and resellers can give the best security and assurance by utilizing both. After all, there’s no harm in having data backed up in more than one location.

Offsite storage backup is a great way to store archived data that may not need to be accessed on a daily basis, although it is still easily available. For onsite backup, XZ Backup’s NAS storage appliance provides immediate onsite recovery, all under the 100-percent-transparent branded backup program.

XZ Backup’s reseller storage needs range from gigabytes to terabytes, with an average need of 40G of storage for a typical small business. Resellers now have a strong opportunity to market their branded backup to SMBs and demonstrate the benefits of keeping data in the cloud.

1) Data center density laws in the U.K., which are not in place in the U.S., allow data centers in the U.S. to provide more power per server cabinet. This is more convenient for online backup resellers, giving them relatively limitless storage. U.S. data centers are able to provide five times the amount of power and five times the amount of storage per cabinet compared to data centers in the U.K. By being able to condense the data centers and use less real estate space, online backup companies in the U.S. are able to offer their services at a much lower price.

2) The currency exchange rate is presently in the U.K.’s favor. One U.S. dollar equals .61 British pounds – meaning that anyone living in the United Kingdom will pay £12 for every $20.

3) Although it may seem like the U.K. is a great distance from the U.S., in reality the countries are only a few fiber hops away in the electronic world. The ping time/latency from the U.S. to the U.K. shows relatively no speed difference than if the backup company were in the same country.  

Almost half of XZ Backup’s customer base is international, with a substantial presence in the U.K. XZ even provides its customers with a technical support/service phone number for London, so that the company is more easily accessible for both users and resellers in the U.K.

Reasons for shedding themselves of their online backup services range from ‘modest levels of adoption’ of the services by customers, to not wanting to compete with the big dogs of storage, such as Amazon’s Simple Storage Service (S3) or Jungle Disk.

Iron Mountain’s CEO, Richard Reese, also mentioned the possibility of partnerships to continue to offer customers remote backup along with other information management systems. Reese said they are also considering repositioning themselves as a reseller - comparable to XZ Backup’s business model.

Iron Mountain joined the online backup world not too long ago in 2009 with Virtual File Store (VFS), a cloud-based storage system and shortly after introduced the Archive Service Platform (ASP), allowing users to integrate the cloud storage in its back end. Current users of VFS are invited to transfer to a higher value File System Archiving (FSA) by next year; however users of ASP will be required to move to a different service provider.

In consideration since fall of 2010, Iron Mountain’s restructuring gives other online backup companies an opportunity to position themselves favorably in the market. White label online backup providers such as XZ Backup, can leverage storage growth trends along with market restructuring and gain a new audience of online backup resellers.

And that certainly applies for the IT marketplace. IT consultants, solution providers, and value added resellers (VARs) need to communicate who they are, how they’re different, and provide their clients with a unique and dependable service. Vertical Systems Reseller recently featured a Q&A with Jonathan Fisher, COO of BrandExtract, on ‘The Key to Brand Recognition’ (full article below). Jonathan discusses the key for solution providers to stay competitive with the big IT companies: “Build a value proposition around the big brand” and show the client how valuable your service is.

One way for IT consultants to brand themselves and create added value is through white label online backup. Online backup resellers can provide their clients all the necessary IT services in a one-stop shop, including 100 percent transparent and reliable backup, under their brand name instead of the online backup company’s name.

This added service saves the client time and money and allows the consultant to charge premium pricing for premium service. And if the competition does not provide branded online backup, then you’re already one step ahead in the market.

Full Q&A from Vertical Systems Reseller:

The Key to Brand Recognition

4/5/2011

By Lisa Terry
Everyone knows it’s important to market their business. But what about branding? As the IT marketplace shifts to one based on services rather than product margins, it’s important for solution providers to emphasize their own brand over their software and hardware partners. VSR talks to a branding expert Jonathan Fisher, chairman and COO of BrandExtract, about how technology companies can build and sustain their brands.

What is branding?
A brand is a person’s perception of a product, service, experience, or organization.

The marketplace has something they want or need, and you have a product or service you want or need to provide. The art of branding is to make those overlap as much as possible. The greater you can align the perception with what the market truly needs, the more compelling. When they are aligned you build loyalty.

Why is it important for solution providers to create a brand for themselves?
Solution providers need to differentiate themselves in the market and understand that the brand has to be unique and be aligned with needs. With a strong brand you can get premium pricing, accelerate demand, protect your territory, shorten the sales cycle, and create barriers to entry. Psychological tests have proven that people are hard-wired to prefer a known brand regardless of the way it performs.

A brand is an asset; we’ve seen companies being bought for an additional multiplier due to the strength of the brand.

How should solution providers balance their own brands with their association with big IT brands?
Big brands in today’s market are becoming more commoditized. Particularly with hardware, other solution providers can sell the same product. Therefore, the solution provider has to build a value proposition around the big brand—a way to enhance it and show that you’re not just a pair of hands delivering it to them.

With software, people are looking for the underlying technology to be secure. The power of the big brand is that it provides that feeling of security. But it’s not enough to have that core technology. You’ve still got to provide the service to back it up, show how much faster or more efficient you are in delivering it, for example, so it starts to matter in the decision process.

Solution provider business models are changing quickly. How can you create a brand that stays consistent even as the business evolves?
You have to go back to the question of what the marketplace truly needs and wants. Is it software you’re selling, or is it assurance, clarity and competence you’re selling? We have one client with decision modeling software, but are they selling software or the confidence that the decision-making is the best it can be? It’s hard to compete with features and functions—they don’t differentiate you for more than a few months. You’ve got to dig down into your true value proposition.

What’s the first step?
You should start with an assessment of your brand in the market, both quantitative and qualitative. You need to interview existing customers and prospects on their current view of the brand, and do a gap assessment. You need a mechanism for accepting feedback—surveys, calls, a benchmarking study.

That can be outsourced or done in house, but sometimes it’s easier to work with an outside firm than do this exercise internally, because outside professionals are objective; they’re not arguing for their jobs, or the politics of the organizations. They’re not focused on historical failures. They don’t have preconceived notions. Clients may not tell you what they really want to, because they want to be non-confrontational. An outside party allows an unbiased view. In 10 minutes I can uncover things a company has never heard before. I have seen organizations be successful doing it on their own, but it’s an advantage to use an outside firm.

How can you sustain the brand over time?
It’s not one and done. Brands are constantly evolving; the marketplace will force your brand in a direction. You can’t keep the same message; it’s got to continuously shift. The secret to making it sustainable is to honestly focus and pilot and perfect before you move on, not to put more things in the plan than you can actively handle.
   
What are some common branding mistakes?
One is not doing an assessment; assuming you have the correct answer: I’ve always sold this way, therefore this must be successful.

Two is not looking at the competition, not doing external research to the depth it needs to be done. You don’t want to come out with a great new tagline and then receive a cease-and-desist order from the solution provider down the street.
Three is thinking there is going to be some silver bullet, that any one tactic, channel, or method is capable of managing and building the brand. It truly requires integrated strategies.

Four is thinking branding is just a logo or a tagline or a brochure or website. Brand is perception—how you answer the phone, what your office looks like and what your reps do in client offices.

XZ Backup's customer base in the U.S. vs. foreign countries

Online backup companies are seeing storage growth trends not only because of the exponential increase in electronic data, but also because of electronic data laws. White label online backup companies provide an easy way for businesses to comply with the federal regulations of keeping data available, easily accessible, transparent and auditable.

Here’s a super-brief history lesson on data retention: Government requirements to retain data started in 1966 (before cell phones, iPads and even desktop computers) with the Freedom of Information Act (FOIA), which is still enforced today. The FOIA mandates that the federal government allow public access to its records with written request, unless the requested information falls under one of the nine exemptions.

You can imagine the amount of data the U.S. Government creates every day and how necessary remote online backup is for it to function and comply with the FOIA. In 2010 alone, the government received 597,415 requests for information.

More recently, the U.S. enacted the Sarbanes-Oxley Act of 2002, which requires all public companies to archive all electronic business records and communications to create transparent and auditable data and prevent corporate scandals.

The U.S. is certainly not the only country with electronic data laws; the UK, for one, has strict regulations in place. Although the majority of XZ Backup’s online backup resellers are based in the U.S. (56 percent), almost half of XZ’s clients are based in foreign markets (44 percent), many of which utilize XZ’s services in order for their clients to comply with data retention laws.

The UK’s extensive electronic data laws include requiring all emails sent by financial institutions be saved for at least six years, wages and salary information be saved for at least six years, and financial promotion information regarding pensions be saved indefinitely.

Convincing your clients to take advantage of remote online backup should be pretty easy once they realize all the federal rules and regulations required for financial and government institutions and publicly traded companies.

As companies grow and capabilities are enhanced, more data is created and requires more storage. As a result, storage companies are seeing storage growth trends each year, with 2009 bringing in $16.5 billion and 2010 topping off at $19.4 billion, an 18 percent increase that is expected to continue into 2011.

To meet the growing data storage demands of its customers, XZ Backup is in the process of building a 9,000-square-foot webcam data center with raised flooring and three megawatt power consumption, expected to be complete in December 2011.

For both online backup companies and online backup resellers alike, data growth is great for business. According to Promise Technology, there are a number of factors that affect data and storage growth, such as:

• Complex graphics, online videos, 3D animation, and smart phone capabilities.
• Business continuity and disaster recovery plans to minimize disruptions of service, ensure timely resumption of operations, and limit financial loss.
• Regulatory compliance policies and processes that financial firms have in place to ensure compliance with laws, rules and regulations, including requirements to retain data or records. 
• Medical industry standards for privacy and security of personal health data (HIPAA).

These government requirements and advancements in technology will only get more complex. Data will to continue to grow exponentially. And white label online backup companies like ours will continue to adapt to changes in the market, offering more storage and with the latest hardware and technology.

Display of XZ Backup's growth- 112% increase in signups for March 2011 compared to March 2010

Data loss is rising. According to the IDC (International Data Corporation), organizations average 14.4 unintentional data losses a year – this can and is being prevented by companies utilizing online backup. A trend is apparent as the number of online backup resellers is escalating, and companies like ours are seeing dramatic spikes in growth, even over just the past year. (XZ Backup’s increase in sign-ups year-over-year is illustrated below).

For all the managed service providers, systems integrators, value added resellers, and internet service providers out there, you can help prevent your clients’ data loss with branded online backup – and the best part is: it’s simple, and you can start for less than $20.

XZ Backup is the only company that provides 100 percent transparent, white label online backup solutions with fully branded products and marketing materials, such as branded websites, including every aspect of the desktop software from the title bar to the splash screen.

IT consultants who utilize XZ Backup’s services have the ability to create their own pricing and terms of service and give their clients a newfound peace of mind knowing their data is secure.  

With the first ever World Backup Day last week (3/31), the risk of data loss could be more front-of-mind for your clients. Now you can easily expand your services and become a backup reseller providing a product that is 100 percent branded to your company. Did we mention: no branding fees, contracts, or the hassle of managing servers and software?

Let us know if you have any questions on branded online backup or want to give us a try – we’re happy to help you and your clients.

So where is all this data? Who knows, most of it is beyond the scope of Google’s crawlers, what some might call ‘dark data.’ The point though is that as developed markets continue to maintain at least some semblance of growth, the support needed to drive data capture will continue to take place.

For more information check out the article:

Worldwide Disk Storage Systems Finishes 2010 with Double-Digit Growth on Strong Fourth Quarter Results, According to IDC

04 Mar 2011

FRAMINGHAM, Mass., March 4, 2011 – Worldwide external disk storage systems factory revenues posted year-over-year growth of 16.2%, totaling just under $6.1 billion, in the fourth quarter of 2010 (4Q10), according to the International Data Corporation (IDC) Worldwide Quarterly Disk Storage Systems Tracker. For the quarter, the total disk storage systems market grew to just shy of $8.3 billion in revenues, representing 14.3% growth from the prior year’s fourth quarter. Total disk storage systems capacity shipped reached 5,127 petabytes, growing 55.7% year over year.

“The fourth quarter of 2010 continued the trend of economic recovery, and helped close a successful year for disk storage,” said Liz Conner, senior research analyst, Storage Systems. “Aiding in the fourth quarter gains, and all of 2010, was the continued growth of network storage, growing 21.7% from 4Q09 to 4Q10 and 25.7% from 2009 to 2010. Reduction in IT budget constraints has allowed end users to take advantage of vertical and use-case specific network storage products introduced in the past 12 to 18 months.”

Total External Disk Storage Systems, 4Q10

EMC maintained its lead in the external disk storage systems market with 26.0% revenue share in the fourth quarter, followed by IBM in second and HP in third with 16.3% and 11.6% market share respectively. NetApp ended the quarter in fourth position, with 10.3%. Hitachi and Dell were statistically tied* for fifth with 8.7% and 7.9% respectively. Given the recent acquisitions of Isilon and Compellent, IDC notes that for 4Q10, Isilon’s and Compellent’s share in the total external disk storage systems market was 0.78% and 0.55% respectively.

Open Networked Disk Storage Systems

The total open networked disk storage market (NAS Combined with Open / iSCSI SAN) grew 21.7% year over year in the fourth quarter to $5.1 billion in revenues. EMC continues to maintain its leadership in the total open networked storage market with 29.7% revenue share, followed by IBM with a 15.2% revenue share.

In the Open SAN market, which grew 15.1% year over year, EMC was the leading vendor with 20.1% revenue share, followed by IBM in second and HP in third with 19.0% and 15.4% share, respectively.

The NAS market grew 41.3% year over year, led by EMC with 52.8% revenue share and followed by NetApp with 23.7% share. The iSCSI SAN market continues to show strong momentum, posting 42.1% revenue growth compared to the prior year’s quarter. Dell led the market with 32.6% revenue share, followed by HP in second and EMC in third with 14.7% and 13.4% market share respectively.

“The high-end segment (average selling price $250,000 and over) was seasonally strong in the fourth quarter, showing the highest sequential growth across all storage segments,” said Amita Potnis, senior research analyst, Storage Systems. “After significant declines during the 2009 crisis and the strong recovery in 2010, the high-end revenue market share is now 30.2%, thus bouncing back to the 2008 pre-crisis levels. There were multiple drivers beyond the remarkable growth in high-end systems, including demand for storage consolidation and datacenter upgrades supported by new product push from a number of vendors.”

Hardware equipment, such as computer systems, peripherals, storage, mobile devices, and network equipment saw an increase of 16%, to more than $661 billion, the fastest rate of growth for hardware investment since 1996. Storage systems spending grew by more than 14%, servers 9%, and PCs by 11%. Software and services returned to positive growth, reaching 4% and 2% respectively.

So that’s the big picture, this year is going to go through a lot of changes, we can already see it ahead. Mobile is beginning to breakout, data growth is astounding, and the cloud is redefining how we approach web software; lots of exciting stuff looking forward. Good luck to everyone.

Worldwide IT Spending Outperformed Expectations in 2010, Reaching $1.5 Trillion, According to IDC’s Worldwide Black Book

09 Feb 2011
FRAMINGHAM, Mass., February 9, 2011 — Global spending on information technology (IT) surged to its fastest rate of growth since 2007 last year, driven by pent-up demand for hardware upgrades and infrastructure investment after the financial crisis and global recession of 2009. According to the new International Data Corporation (IDC) Worldwide Black Book, the global IT market grew by 8% year over year to more than $1.5 trillion at constant currency. Including telecom services, the overall information and communications technology (ICT) market grew by 6% to almost $3 trillion in 2010.

Hardware spending led the way, as a major capital spending cycle saw IT spending on computer systems, peripherals, storage, mobile devices, and network equipment increase by 16% to more than $661 billion, the fastest rate of growth for hardware investment since 1996. Storage spending grew by 14%, servers by 9%, and PCs by 11%.

“Like the global economy, the global IT industry performed better than expected in 2010,” said Stephen Minton, vice president of IDC’s IT Markets and Strategies Group. “With business profits and stock markets back into a cycle of growth, many organizations took the opportunity to make up for lost time by upgrading mission critical systems and infrastructure over the course of the year. While downside macroeconomic risks are still present, we entered 2011 on the back of a resounding rebound for the technology industry.”

The pace of recovery was more robust than after any previous economic recession, in spite of the severity of the 2008/2009 financial crisis. Spending on software and services, while lagging the pace of hardware investment, also returned to positive growth of 4% and 2% respectively. This is set to accelerate in 2011, as investment in new IT projects (including rapid adoption of cloud computing) begins to make up for an inevitable deceleration in the pace of capital spending by the end of the year. The overall IT market will grow by 7% this year to $1.65 trillion with another year of double-digit growth for hardware spending (10%), while software and services markets will increase by 5% and 4% respectively.

“The global economy could still be a wild card,” said Anna Toncheva, program manager and economist in IDC’s IT Markets and Strategies Group. “The sovereign debt crisis in Europe may raise its head again, and we still lack sufficient visibility into many variables to be sure that a double-dip recession will not occur. However, the consensus opinion is currently that such a downturn is much less likely now than six months ago, and this continued economic stability will provide the foundation for another year of strong growth in the IT industry.”

The U.S. IT market grew by 6% in 2010, and will expand by another 5% in 2011, but emerging economies are again leading the way and driving the overall growth of the global industry to higher levels. The Asia/Pacific region, excluding Japan (APeJ), saw growth of 13% last year, which will be followed by a 10% increase in 2011. Double-digit growth is also forecast in Central & Eastern Europe, Latin America, and the Middle East & Africa. Meanwhile, other mature economies including Western Europe, Japan, and Canada will continue to expand at a lower but sustainable rate of growth, much like the U.S. High levels of unemployment will continue to inhibit overall IT investment in many of those countries, but positive drivers will include adoption of cloud computing, the continued proliferation of mobile devices, and investment in new software analytics tools.

“Last year was a big year for the technology industry,” said Minton. “Some of the growth was just a bounce back from the declines of 2009, when the market declined by 4%, but there was also a very real surge of demand as businesses around the world continue to deal with the issue of managing, storing, securing, and analyzing the increasing flood of digital information that is resulting from the proliferation of mobile devices and embedded computing platforms. As long as the economy remains stable, we look forward to another strong year of investment in 2011.”

On February 17th, Minton and Toncheva will host an IDC Web conference focusing on IDC’s new IT spending forecast. The presentation will include a discussion of regional trends across hardware, software, and IT services markets, as well as the drivers and inhibitors for IT investment in 2011 and beyond. For more information, or to register for this event, go to http://www.idc.com/events/eventwebconference.jsp?containerId=IDC_P22469.

Desktop HDDs were up 1.8% sequentially, to around 64 million in Q4 ’10. Average capacity rose from 655 GB to 755 GB, quarter-to-quarter. Total desktop HDD capacity in Q4 weighed in at 48 exabytes.

For Enterprise HDDs, the market reached above 8 million unit sales in Q4. Demand is holding steady, and shipments are back to pre-recession levels. Total capacity shipped reached 2.56 exabytes.

Consumer Electronic HDDs pulled back as expected because of seasonal patterns, with shipments dropping 6.4% from quarter-to-quarter. Nearly 8 exabytes were shipped in CE HDDs in Q4 ’10.

http://www.storagenewsletter.com/news/disk/trendfocus-hdd-4q10