Forrester: Business Users Are Not Ready For Cloud Storage

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A recent report by Forrester's Andrew Reichman titled Business Users Are Not Ready For Cloud Storage: Current And Planned Adoption Of Storage-As-A-Service Is Minimal For Now paints a picture for cloud storage adoption, that at first blush, is not encouraging.

He states:

In Forrester's Enterprise And SMB Hardware Survey, North America And Europe, Q3 2009 survey, we asked businesses about their interest in "hosted storage capacity" offerings. Interest was minimal at best. Forty-three percent of all respondents said that they were simply not interested, and another 43% said that they were interested but had no plans to move forward.
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While it could be argued that as a cloud storage supplier, I am necessarily bullish about the ultimate prospects, I believe the data is actually quite good and clearly represents what we are experiencing in the marketplace.  Now, Mezeo is engaged with many service providers, as well as the early adopters in the enterprise space as they begin their evaluations.

When I look at enterprise cloud-storage adoption based on Everett Rogers' diffusion curve I see a pretty clear view of the typical market place approach to adoption of disruptive technologies:    

diffusion.gifFor new, emerging, and potentially disruptive technologies, we should look for what the next practices are, i.e. the practices of the innovators and early adopters. The survey reflects the typical technology adoption cycle and re enforces what we are experiencing in the market place.

11% of companies are taking the plunge - these are the early adopters and innovators.  The early majority (43%) is interested, and watching.  The late majority is not in the game, yet.

So we are on track. And to prove it, let's look at one of these enterprise-level innovators: General Electric.

According to IBM storage expert Tony Pearson, GE has implemented cloud-based backups and archive for GE Corp, NBC Universal and GE Asset Management divisions running at only 32 cents per GB/month, representing a 40-60 percent savings over their previous methods. This includes backups of their external Web sites, archives of their digital and production assets, RMAN backups including development/staging databases. They plan to add out-of-region compliance archive in 2010. They also plan to monetize their intellectual property by offering "CloudStorage Manager" as a software offering for others.

There are other comments in the Forrester report that range from the usual concerns of security and multi-tenancy to a discussion around lack of definition of use cases.  While it is helpful to raise these typical concerns, they are not descriptive of our daily marketplace experience.  Rather, they are more associated with what I call the two pillars of cloud storage understanding.  The two pillars are as follows:

2pillars.jpgIf you share the Pillar 1 view (and this is the case both in the enterprise and with many traditional storage suppliers), then the typical concerns may outweigh the advantages.  However, consider Pillar 2, which addresses new application enablement and new capabilities that enable security, multi-tenancy and use case definition (Pillar 1 concerns).  Pillar 2 represents a market maturity view that is shared by all of us, suppliers, service providers, and early adopters.

Remember, cloud storage came about in the IT Service Provider space, specifically as a source of storage for new applications being driven by hosted web applications.  These applications are now extending into every facet of the information technology space, including IT service providers, the enterprise, SMB and consumer use cases. 

You can no more dismiss cloud storage than you could SaaS or the web itself! 

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This page contains a single entry by Steve Lesem published on February 11, 2010 9:27 PM.

Cloud Storage for the Enterprise - Part 2: The Hybrid Cloud was the previous entry in this blog.

An Update from the Parallels Summit, Miami 2010 is the next entry in this blog.

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