Outsourcing data storage considerations for SMBs

Outsourcing data storage and backups is an effective way for small to midsized businesses (SMBs) to capitalize on IT without making the investment themselves. This tutorial provides a list for small to midsized businesses (SMBs) to consider when determining if they should outsource their data storage and backups.

Outsourcing data storage and backups has proven to be an excellent way for businesses to capitalize on technology benefits without having to make the investment themselves. With the increased tightening of capital markets squeezing small to midsized businesses (SMBs), outsourcing allows SMBs to free up what would be long-term, capital expenditures, transferring the investment to a pay-as-you-go operational expense.

SMBs that leverage storage outsourcing, and in particular backups, also reduce technology implementation costs, including IT headcount, monitoring and managing the devices, maintaining patches and bug fixes, and maintaining software licenses. As SMBs continually seek to improve cash flows and balance sheet statements, storage outsourcing is a natural model to consider.

The following is a list of things SMBs should consider when determining if they should outsource their storage needs.

1. Don't settle for a marginal storage offering based on price.

Instead, focus on meeting your business's near- and long-term storage requirements. There are literally hundreds of service providers in the market. Prior to developing your company's request for proposal (RFP), decide what features and functionality are "must haves" versus "nice to haves."

This list will not be shared with the RFP participants, but it will act as your guideline when interviewing prospective storage hosting providers. For example, do backups need to be performed intermittently during the day, like in the case of a financial business, or is middle of the night adequate for your business? How often are the backups tested for accuracy and completion?

The must-have feature list is nonnegotiable and the nice-to-have feature list is your area of negotiation. If the provider can't come down in price, then the service features need to come up. Focus on features and functionality and pay the rate it is worth to your business. For example, if you must perform large data file activities, make sure the storage strategy accommodates the capacity needed.

2. What types of backups are supported?

Make sure to point out that there are different considerations. Bandwidth is probably a far greater consideration if a company is going to use a service for its primary or near-line storage versus just for backup.

On a pay-as-you-go model, the type of backups will ultimately define a substantial part of the bottom line of your outsourced storage expense. Some providers offer full backups each night, while others offer file-level backups.

Full backups are a complete copy of all the files every night. This creates massive amounts of storage capacity requirements very quickly.

File-level storage backs up only files that have changed or that are new from the prior backup. This method is substantially more economical in terms of storage footprint than full daily backups.

3. Where is data deduplication performed?

Where data deduplication is performed makes a difference. If dedupe is performed at the service provider site, then the cost of bandwidth to transmit unnecessary files is an unnecessary, superfluous expense. This means you'll pay a lot for bandwidth even though the data is eventually deduped or compressed.

If dedupe is performed at your site, is it agent-based or appliance-based? If it is agent-based, then the agent will consume its own footprint on the local server, plus CPU cycles. If deduplication is performed on your site using an appliance, then the CPU cycle consumption is transferred to the appliance. Get clarity on who owns the appliance and is responsible for its upkeep. This could be an unforeseen expense. These last two alternatives will have far lower bandwidth costs.

4. Does the outsourced storage provider use multi-tenancy on the servers?

You want to ensure that your data does not co-mingle with other companies' data the service provider is supporting. It is not unusual for a service provider to have several SMBs on the same storage server, segregating the companies across different blades and/or using virtualization software. Be sure you fully understand how your firm's data will be secured against data leakage within the same storage device.

Some specific questions for providers to prevent data leakage include: How many companies are supported on a virtual server? Are the virtual server blades set up to support one blade per company or do multiple companies reside on a common blade? How are backups conducted of the virtual server blades: all at the same time or staggered?

These are a few of the considerations you need to ask hosted storage provider. The goal is to get them to ensure that your data will be isolated from another business' backups that the provider also supports.

5. How is data recovery supported?

There are two main methods for outsourced storage recovery: simple data backups and bare-metal restore. Simple data backups are the most basic backup option. Simple data backups only back up the application data. This method does not back up the applications themselves, nor does it back up the operating system.

Bare-metal restore restores a computer from the ground up, including the operating system, applications and data. Bare-metal requires an entirely new device to restore to. The decision between which recovery method to use depends on the cost of downtime for your business.

As SMBs look at storage and backup outsourcing as a way to contain business expenses, a close examination of the business' storage requirements going forward prior to the RFP process will assist in selecting the best storage service provider for your business. As illustrated above, there are options within components of outsourced storage that can only be addressed by knowing the business' needs and objectives. Knowledge of the business' storage requirements will ensure you only buy what you need, further improving the ROI of using an outsourced storage provider.

Martha Young is principal and CEO of Nova Amber LLC, a business consulting company specializing in business process virtualization.

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