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Secure, Reliable and Compliant: How the Cloud
Can Make Archiving Profitable for the Channel
N An Osterman Research White Paper
Published July 2011
SPONSORED BY
sponsored by
SPON
sponsored by
Osterman Research, Inc.
P.O. Box 1058 • Black Diamond, Washington • 98010-1058 • USA
Tel: +1 253 630 5839 • Fax: +1 253 458 0934 • info@ostermanresearch.com
www.ostermanresearch.com • twitter.com/mosterman
2. Secure, Reliable, and
Compliant: How the Cloud Can
Make Archiving Profitable for
the Channel
EXECUTIVE SUMMARY
Organizations of all types – small businesses, professional organizations, government
agencies, associations, and larger enterprises – have statutory obligations to retain
important records sent, received and stored in their email systems. Moreover,
organizations of various types, including government agencies, must also retain data
for purposes of eDiscovery and similar types of obligations. Use of cloud-based
archiving solutions offers a secure, reliable, compliant and profitable option for the
channel.
KEY TAKEAWAYS
• Organizations of all types and sizes must implement email archiving capabilities
that will permit them to capture very large amounts of information, retain it for
many years (or indefinitely in some cases), and produce it as accurately and as
inexpensively as possible.
• IT budgets for the deployment of new infrastructure are often flat or declining
because of flat revenue or the need to increase profitability.
Organizations of
For customers, cloud-based archiving offers more predictable costs over time,
•
very high scalability, rapid deployment, highly secure storage and high
all types and sizes
availability – all critical requirements when storing and managing content. must implement
• For channel partners, cloud-based archiving should seriously be considered as a
email archiving
means of satisfying customer demand for content retention and as a means of capabilities that
creating a profitable revenue stream.
will permit them
ABOUT THIS WHITE PAPER to capture very
This white paper explores the various obligations that organizations have to retain large amounts of
email and other content, and it explains the benefits to service providers of using
cloud-based services to meet their archiving obligations. This white paper also information,
provides a brief overview of Sonian, the sponsor of this white paper, and their retain it for many
relevant channel offerings.
years, and
produce it as
WHY YOUR CUSTOMERS NEED TO ARCHIVE accurately and as
ORGANIZATIONS HAVE AN OBLIGATION TO RETAIN DATA inexpensively as
Every organization – regardless of its size, the industry it serves or how much data it
possesses – must retain important records for various lengths of time. The
possible.
requirement to retain data is imposed from a variety of sources, including legal
precedent in which courts establish standards for the length of time that data must
be retained, statutory obligations that specifically define the retention and production
obligations for certain types of data, and internal best practices. Retention
obligations apply for all forms of data, both physical and electronic.
Organizations “non-regulated” industries are no exception to retention requirements
and, in fact, can face just as many obligations as “regulated industries”. In fact, the
distinction between non-regulated and regulated industries is a false dichotomy –
there are only heavily regulated industries like financial services, healthcare, energy
and pharma; and more lightly regulated industries. Moreover, we can expect that
oversight and management of data will become stricter and more expansive in the
future as requirements only get more stringent and more difficult to satisfy.
NON-STATUTORY CONSIDERATIONS ARE ALSO IMPORTANT
However, aside from the statutory and related types of requirements to retain data
for long periods, there are four important reasons for organizations to implement
archiving technology:
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3. Secure, Reliable, and
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• To meet eDiscovery requests and reduce related costs
By managing eDiscovery with a centralized archive, organizations are generally
much more capable of handling the needs of lawsuits and the courts. In
addition, proactively addressing this function in a systematic way can
significantly reduce overall eDiscovery costs and speed the entire process,
particularly for organizations that have frequent or extensive legal requirements.
• To reduce IT costs
By migrating data from more expensive storage on email servers and other data
stores, archiving can reduce overall storage costs by placing older data into less
expensive archival storage systems. This can significantly reduce overall data
management costs, particularly for larger agencies that store voluminous
amounts of data.
• To improve storage management Records
An archiving system can make storage management much easier by indexing
content and making it more easily discoverable and accessible. This is
generated and
particularly important for agencies that must respond to sunshine-law or received by
Freedom of Information Act (FOIA) requests frequently, since it minimizes the organizations
amount of time that employees must spend searching for, filtering through and
producing data for requestors. must be
preserved, in
• To improve email system performance
An archiving system can dramatically improve email system performance by some cases, for
minimizing the amount of “live” data that must be stored on email servers. many years or
Because email messages and attachments older than 30 days are not accessed
frequently, it makes sense to migrate this content to an archiving system for even indefinitely.
purely functional considerations. Doing so will reduce the amount of time This creates an
required to backup email servers, it will speed the restoration of a server from
backups when necessary, it will reduce the amount of overall downtime enormous
experienced in the email system, and it will make message delivery faster. problem for
organizations
PROBLEMS THAT ORGANIZATIONS FACE that do not have
There are four serious problems that organizations face in the context of their data the indexing,
management practices and obligations:
storage and
• Email is the de facto communications and file transport mechanism extraction
For most organizations, email has become the primary method for capabilities in
communications and for sending files. While email is useful in this regard, using
it in this way means that a large proportion of records that must be retained for place to manage
long periods get stored in email systems and not in dedicated archiving or other this information
systems focused on content management. If this content is not archived
appropriately, it can become lost as a result of server crashes, data corruption or properly.
accidental deletion of information. Even if it is not lost, extracting needed
content from an email server or a backup tape is arduous, expensive and time
consuming.
• Content must be retained and readily available
Records generated and received by organizations must be preserved, in some
cases, for many years or even indefinitely. This creates an enormous problem
for organizations that do not have the indexing, storage and extraction
capabilities in place to manage this information properly. Poor content
management can result in an inability to produce information on demand,
resulting in sanctions, adverse judgments and other negative consequences.
• BYOD complicates retention
The trend of “consumerizing” IT – that is, employees using their personal devices
and a variety of Web 2.0 applications for work-related purposes, or Bring Your
Own Device (BYOD) – is increasing. Employees are motivated to do so because
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they have the opportunity to use tools that they select and are specific to their
requirements. IT departments are warming to the idea of BYOD, at least for
hardware like smartphones and tablets, because employees are willing to bear
the cost of expensive communication and collaboration tools rather than
requiring IT to pay for them out of their own budget.
That said, BYOD can significantly complicate content retention. For example, if
users are creating and receiving records on personal devices, this content must
be retained as if these records were created and received on agency-owned
devices. If they are creating records using Twitter, Facebook or other Web 2.0
applications, this content may also need to be retained. However, data must be
extracted and retained by the employer, not an easy task for most organizations.
Add to this the problems associated with cloud-based applications that are
deployed by end users, such as Dropbox or Microsoft Skydrive, that store
corporate content in difficult-to-access repositories that are under the control of
individual users, not IT.
if we assume that
Enormous quantities of data make retention and access more difficult each employee in
Finally, another serious problem faced by organizations – even smaller ones – is that
enormous data stores complicate the storage of content, make it more difficult to find a 7,500-employee
and thereby increasing IT costs. For example, if we assume that each employee in a organization
7,500-employee organization generates 40 archivable records each day (five
megabytes of content), and that this content must be preserved for 10 years, this will generates 40
generate 750 million records and 89 terabytes of content over that retention period. archivable
In the absence of a robust and scalable storage and management infrastructure,
finding content in data stores this large is, at worst, impossible and, at best, very records each day,
difficult and expensive. and that this
content must be
SOLVING THE PROBLEM OF CONTENT preserved for 10
RETENTION years, this will
As discussed earlier in this white paper, organizations face some fundamental generate 750
problems in the context of their content retention requirements: million records
• They must retain a wide variety of data for purposes of satisfying retention laws, and 89 terabytes
compliance requests, potential responses to legal actions, and the like. of content over
• They must make this data easily accessible to staff members responding to these that retention
requests and to others that may need ready access to important data. period.
• Given the financial pressures that most organizations are under, they must
satisfy these requirements as inexpensively as possible.
To solve these challenges, organizations have four options:
• Do nothing
• Deploy on-premise servers and software
• Use a cloud-based archiving system
• Use a hybrid approach
Let’s examine why the cloud can make sense for many organizations.
WHY THE CLOUD MAKES SENSE FOR DATA RETENTION
Given these critical requirements, here is our view on the 10 reasons that cloud-
based archiving makes sense for use by organizations of all sizes and across all
industries:
1. Low (or no) initial costs
One of the fundamental advantage of cloud-based anything – be it email,
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5. Secure, Reliable, and
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security, archiving, etc. – is the fact that there are virtually no up-front costs
associated with deploying a cloud service. Because there are no initial
requirements for the purchase of servers, software and other infrastructure
elements as is the case with the on-premise, capital expenditure (CAPEX) model,
the cloud operating expense (OPEX) model allows any organization to implement
a complete archiving capability with virtually no up-front cost. While there may
be some minimal costs associated with IT staff to specify capabilities, ingestion
of legacy data and the like, these costs are in almost all cases very low.
2. More predictable costs of ownership
Similarly, a cloud-based archiving system has more predictable costs of
ownership than the traditional on-premise model, largely because the cloud
provider defines the costs of the archiving capability up-front and these costs
remain constant over the life of the contract. With an on-premise system, there
will be periodic requirements to add more storage as more content is retained,
which can lead to off-budget costs at inopportune times.
3. Lower overall total cost of ownership The combination
The combination of minimal up-front cost, combined with more predictable on- of minimal up-
going costs, means that cloud-based archiving generally has a lower TCO than
on-premise archiving even when a large number of users are supported. While front cost,
lower TCO is of benefit to virtually any organization, it is especially advantageous combined with
to companies facing tight budgets or government agencies that are facing severe
budget cutbacks. In short, the use of cloud-based archiving can help any more predictable
organization to meet their content retention obligations and to do so in an on-going costs,
affordable manner, and it can reduce IT’s current expenditure obligations.
means that
4. Rapid deployment of archiving capabilities cloud-based
One of the chief benefits of cloud-based services is their ability to be deployed
much more rapidly than on-premise infrastructure. This allow organizations to
archiving
deploy an archiving capability in a matter of a few hours or days, unlike on- generally has a
premise systems that might take a few weeks or months or more to evaluate,
specify, deploy and configure. Moreover, new capabilities can be added very
lower TCO than
quickly with cloud-based services, such as the addition of more storage, on-premise
archiving of more users’ content, or retention of new content types.
archiving even
5. Scalable storage when a large
One of the more important benefits of cloud-based archiving is that it offers a
virtually unlimited pool of storage, one that can be scaled to almost any level to
number of users
meet increased demand. Although on-premise systems can also provide scalable are supported.
storage, scalability is more easily accomplished in the cloud than with on-premise
systems.
6. A high level of security
While some decision makers may be concerned about the security of sensitive or
confidential content in the cloud, cloud-based archiving actually offers better
security than most on-premise archiving systems can provide. Because cloud
providers can afford to pay for more robust security measures than most
organizations can afford, cloud security is generally better than what they could
hope to provide on-premise.
7. Protection against changing storage standards
Particularly relevant for many organizations that must retain data for long
periods is the need to “future-proof” content against changing storage standards.
Because these standards change over time, content stored in on-premise storage
systems must be updated periodically to reflect new standards, new media types
and the like to ensure that data is still readable 10 or more years after it is
initially stored. However, this is not easily accomplished with on-premise
archiving systems. With cloud-based archiving, on the other hand, changing
storage standards become the provider’s problem and not the problem of the
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organization that is charged with storing data. This not only reduces TCO, but
also ensures that records can easily be read for many years.
8. High speed search capabilities
Cloud-based archiving can provide very high-speed search capabilities, allowing
organizations to respond to eDiscovery and other requests very quickly. The
ability to search through enormous data stores quickly can reduce the amount of
time – and cost – for these searches.
9. Highly available storage
Archiving in the cloud also results in highly available storage. Cloud-based
archiving can provide the same or higher level of uptime as on-premise
infrastructure – for example, Amazon’s S3 service guarantees server uptime of
99.99% (no more than 4.4 minutes of downtime per month). Moreover, leading
cloud providers replicate content to geographically separate data centers,
offering a level of disaster recovery that would be expensive to provide with on-
premise infrastructure.
10. Significant financial benefits over the long term
Finally, cloud-based archiving can deliver significant financial benefits to Cloud-based
organizations in two ways. First, by eliminating virtually all up-front expenses,
cloud-based archiving can eliminate much of the initial expense associated with
archiving can
archiving, allowing agencies to shift the bulk of their expenses to future years. provide the same
Second, cloud-based services are generally becoming less expensive over time. or higher level of
This is not the case with on-premise capabilities, which – because of their
significant IT labor component – are becoming more expensive as the cost of uptime as on-
labor increases. This will result in greater long term return-on-investment premise
benefits for cloud-based archiving over time.
infrastructure –
for example,
WHY CLOUD ARCHIVING BENEFITS RESELLERS Amazon’s S3
Many of the benefits of cloud archiving also flow-through to the channel. Here are
the key reasons the channel should considering adding a cloud-based archiving
service
offering to the solutions they offer their current and future customers: guarantees server
• Ease of deployment
uptime of
There is no infrastructure to deploy and no ongoing IT labor requirements. 99.99%.
• Complementary with current offerings
Cloud-based archiving can be an excellent complement to current channel
offerings.
• Immediate revenue generation with high profitability
Due to the rapid nature of the deployments and relatively minimal investments,
this offering can provide immediate cash flow to channel partners.
• Ongoing revenue streams
Given the long-term nature of content retention – coupled with recurring,
monthly fees – cloud-based archiving offerings can provide an excellent, ongoing
revenue stream.
CHANNEL PARTNER REVENUE
Now, how much revenue can a channel partner generate with a cloud-based
archiving model? If we use Sonian’s pricing, assume that a channel partner will
receive a 50% margin, and assume that 100 new mailboxes will be added per month
over a three-year period, the total revenue generated for a reseller will be $147,600
during this period. If we assume 500 new mailboxes added per month, the total
reseller revenue generate over three years will be $738,000. Reseller revenue
generated at different mailbox volumes are shown in the following figure.
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Three-Year Reseller Revenue at Different Mailbox Counts
Is the partner
you’re consider a
truly cloud-based
QUESTIONS TO ASK
Finally, here are some questions for channel partners to ask when evaluating cloud- archiving
based archiving offerings: company? In
• Is the partner you’re consider a truly cloud-based archiving company? In other other words, is
words, is their archiving solution designed from the ground up to work in the their archiving
cloud?
solution designed
• Is their solution scalable so that it can handle hundreds of millions or possibly from the ground
billions of records?
up to work in the
• Does the solution provide very high-speed search capabilities so that your cloud?
customers can search through hundreds of millions of records in as short a time
as possible?
What are the certifications that at least some of your customers will require if they
choose to use cloud-based solutions?
SUMMARY
Organizations face significant hurdles in meeting their complex and growing content
retention challenges. Cloud-based archiving offers many significant advantages to
organizations of all types and sizes, and should be added to the mix of offerings for
service providers.
ABOUT SONIAN
Sonian, the pioneer in Cloud Powered Archiving and Search, offers it’s archiving
solutions at a fraction of the cost and complexity of other approaches. With over
8,000 customers across diverse industries and embedded into offerings from other
cloud innovators – Sonian is the future of Archive and Search in the Cloud.
While driving down costs is an integral part of our business model, so is developing
differentiating technologies. The challenging aspect of acquiring and making
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petabytes of data search-able was a formidable hurdle Sonian achieved over the past
4 years. Several years ago, we perfected using the cloud to deliver a million search
hits within seconds. Today we are delivering that one-in-a-million search result within
a second. With our cloud-powered differentiating technology, we believe Sonian is in
a unique position to maintain a leadership position in cloud-based information
archiving and analytics.
Sonian ‘s next generation software and business model are based on cloud compute
economics, security, and reliability. With over 8,000 customers across diverse
industries and embedded into offerings from other cloud innovators – Sonian is the
future of Archive and Search in the Cloud.
© 2012 Osterman Research, Inc. All rights reserved.
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©2012 Osterman Research, Inc. 7