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I recently visited an outsourcing company in the Boston area that provides a back-up and disaster recovery service, writes Bloor Research analyst Robin Bloor. The company was Live Vault, although you're unlikely to hear the name directly as they sell through the channel. There were two interesting points that the company had to offer, beyond the fact that it offers a quick to install service.

The first is that the cost equation is just about ready to squash the use of tapes for back-up. I've heard this form other sources too, so I suspect that it is true. The problem with tapes is that, actually many of them fail. The statistics seem to suggest that in well managed data centers the failure rate of tapes is in the region of 20 percent, while in less centralized environments (distributed organizations or SMBs) the failure rate is more likely to be 50 percent.

It is easy to understand why data centers get a lower failure rate, they probably buy more reliable media and they also probably test the media. However, I'm not sure I believe the figures - at least not on an individual tape basis. It would suggest that any back-up that involved more than 5 tapes would be likely to fail no matter what the site was. However I can believe that in a given percentage of back-ups there are tapes that have failed.

Anyway to some extent it doesn't matter. The situation is that disk is fast becoming a better back-up option from the point of view of cost and outsourced back-up is also looking like a good business area because if the service provider has enough customers, economies of scale kick in.

It seems that at the most the cost equation for this service favours mid-sized organizations that do not have sophisticated IT departments. The larger companies tend to have some kind of full-blown disaster recovery capability which is likely to be well organized and likely to achieve significant economies of scale. But as the cost of disk continues to fall and the availability and the cost of bandwidth falls too, an outsourced back-up service becomes more compelling.

This trend is interesting in respect of the move to utility computing. Many companies outsource web site management and nowadays there is a good business in some outsourced applications (not the success of Salesforce.com). If outsourced back-up becomes more attractive, it becomes yet another move in this direction. As with all such changes in infrastructure policy, utility computing is destined to happen by increments. First one thing, then another, until outsourcing becomes the preferred solution for most problems. It is becoming a well-established trend and it will alter the face of the computing - probably taking root first among mid-sized businesses.

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