Some gigabytes are worth more than others

Getting clarity on the cost and relative worth of enterprise technology has always been a challenge because of the complex environments and diverse requirements involved. For every good question about which product is better, there is the almost universal answer – “it depends”.  One product might have more capacity than it’s competitors, while another might have a unique feature that supports a new application and another product might have a new operating or management approach that increases productivity.  Beauty is in the eye of the beholder and enterprise customers dig a lot deeper than what appears in competitors’ spec sheets. In some respects, it’s like comparing real estate properties where location and design trump square footage.

One of the traps people fall into when comparing the value of cloud services to legacy infrastructure technologies is limiting their analysis to a direct cost per capacity analysis. This article in Information Week did that in a  painstaking way where the author, Art Wittman, made a commendable effort to make a level cost comparison, but he left out the location and design elements.  He concludes that IaaS services are not worthwhile because the costs per capacity are not following the same cost curve as legacy components and systems.  There is certainly some validity to his approach – if the capacity cost of disk drives has dropped an order of magnitude in four years, why should the cost of Amazon’s S3 service be approximately 39% higher?

Conceding that productivity gains can be realized from cloud services, he limits their value to application services and summarily rejects that they could apply to IaaS. After all the work he had done to make a storage capacity cost comparison, he refused to factor in the benefits of using a service.  Given that omission, Mr. Wittman concludes there is no way for an IaaS business model to succeed.

I agree with Mr. Wittman in one respect, if a service can’t be differentiated from on-site hardware, then it will fail.  But that is not the case with enterprise  cloud storage and it is especially not true with cloud storage that is integrated with local enterprise storage. Here’s why:

Storage is an infrastructure element, but it has specialized applications, such as backup and archiving that require significant expense to manage media (tapes). Moving tapes on and off-site for disaster recovery purposes is time-consuming and error-prone. While the errors are usually not damaging, they can result in lost data or make it impossible to recover versions of files that the business might need. The cost of lost data is one of those things that is very difficult to measure, but it can be very expensive if it involves data needed for legal or compliance purposes.  Using cloud storage as virtual tape media for backup kills two birds with one stone by eliminating physical tapes and the need for off-site tape rotations. It still takes time to complete the backup job and move data to the cloud, but many hours a month in media management can be recaptured as well as tape-related costs.

There are even greater advantages available with backup if it can be integrated from primary storage all the way to the cloud, as it is with StorSimple’s cloud-integrated enterprise storage (CIES).  Using snapshot techniques on CIES storage, the amount of backup data generated is kept to a minimum, which means the amount of storage consumed from the storage cloud service provider is far less than if a customer used the cloud for virtual tape backup storage. Cloud-resident data snapshots have a huge capacity advantage over backup storage where the storage of files for legal and compliance purposes are concerned and it demonstrates how the design of a cloud appliance can deliver even more value from cloud storage.

The next increase in cloud storage value comes from integrating deduplication, or dedupe technology with cloud storage.  Dedupe minimizes the amount of storage capacity consumed by data by eliminating redundant information within the data itself. Sometimes, the amount of deduped data can be quite large – as occurs with virtualized systems. StorSimple’s CIES systems automatically applies dedupe to the data stored in the cloud and squishes capacity consumption to its minimum level – which also minimizes the amount of data that is transferred to and from the cloud. With the help of a cloud-integrated enterprise storage system, the capacity of cloud storage increases in value a lot because so much less of it is consumed.

But the worth of cloud storage is not all about consuming capacity, it’s about accessing data faster than you can from legacy data archives. Data stored in the cloud with a CIES system is online and can be accessed by workers and administrators without the need to find it in a separate archive pool of storage. If you don’t work in IT, you might not know how much time that can save the IT staff, but if you do work in IT, you know this is a huge advantage that returns a lot of administrator time for other projects.

The access to data in cloud storage is probably most valuable when it occurs following a disaster.  Cloud storage provides the ultimate flexibility in recovery by being location-independent.  Backup or snapshot data stored in the cloud can be accessed from almost any location with an Internet connection to the cloud storage service provider.  Again, cloud-integrated storage has some important advantages that further increase the value of cloud storage by requiring only a small subset of the data to be downloaded before application systems can resume production work. This is much faster than downloading multiple virtual tapes and then restoring data to application servers.

I could go on – and I will in future blog posts. This one is long enough already. There are numerous ways that cloud storage is worth more than it’s raw capacity.  Some of this worth comes from its role in disaster recovery but a lot of it comes from how it is used as part of an integrated storage stack that incorporates primary, backup, archive and cloud storage.


  1. Hi Marc
    Good post thanks ! I fully agree with you that Cloud Storage is more Costs per TB. The latest Cloud provider outages have proven that for sure. The question will be how much are the Customer willing to pay for a “Data insurance” like Backup, DR etc. and how fast the ROI for the Providers is when they use HSM, DeDup, Compression etc.


    • Thanks for weighing in Roger. Your comment is great food for thought!

      I’m not sure we are in agreement, though. The point I made was that cloud storage helps reduce the costs of legacy storage and the associated management processes – and that in doing so reduces the cost per TB stored. Maybe that’s what you were saying too.

      I just want to make sure that people don’t confuse cloud provider outage with cloud storage. For instance, in the recent leap day outage in Microsoft’s Azure cloud, the storage service was not effected because Windows Azure Storage (WAS) was designed as an independent service. FWIW, if anybody is interested there are some excellent resources to understand Azure storage here. Nonetheless, nobody can guarantee the availability of any system or service and risk management has to be thought through. I’ll try to write something up about how this can be done with cloud storage.

      Your point about provider ROI with HSM, dedupe and compression is an excellent one. Dedupe and compression probably should be done at the customer end, in other words using a source dedupe approach. I definitely will write something on that.

      Thanks again for your thought-provoking comment.

  2. Marc,

    Just discovered you’ve moved. Congrats!! Hope it’s a great set of new opportunities for you

    Since you’re in Santa Clara (is Intel your next move? 🙂 we’re practically neighbors.

    Oh, and just so it looks like I’m “on topic”….cloud storage….there, I’ve said it.