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Ten years ago, a storage executive at an early disk-based backup vendor said to me, “I’ve sold $100 million in tape systems that no one wanted to buy.” Fast-forward to today, and enterprises are still begrudgingly buying tape and tape drives. However, new entrants in the cloud archiving market may finally signal the beginning of the end for tape in the enterprise.
The worldwide information archiving market is robust and growing, thanks to ever-increasing data and compliance requirements. According to a recent report by The Radicati Group, a market research firm, the market will be more than $3 billion by year’s end and will grow to $6.3 billion in 2016. Currently, cloud-based services already account for 31% of that market, while on-premises solutions—including tape—garner the remaining 69%.
Cloud Services Tip the Tape Scales?
But tape certainly isn’t driving archiving growth. Market research firm Santa Clara Consulting Group found that the market for backup tape drive and media dropped to $1.33 billion in 2011, down 14.7% from the previous year, and is off more than 36% since 2007. Meanwhile, demand for cloud-based services has grown at a much faster clip than on-premises solutions, said Todd Yamasaki, market research analyst at Radicati, and will gain even more steam in the coming years.
Then, in August, cloud leader Amazon.com turned the archiving world on its head when it announced Glacier, its entry into the cloud-based data archiving
The monthly penny-per-gigabyte cost is roughly equivalent to the onetime-per-gigabyte price of a compressed LTO-5 tape cartridge, but Amazon claims that over the long run Glacier is cheaper than tape. “Companies typically overpay for data archiving,” Amazon states on the Glacier website. With tape, “they’re forced to make an expensive up-front payment for their archiving solution,” to say nothing of operational expenses such as power, facilities, staffing and maintenance. Rampant overprovisioning, meanwhile, results in “under-utilized capacity and wasted money.” With Glacier, Amazon says, “you pay only for what you use.”
Of course, there are all kinds of gotchas: Amazon promises retrieval times of only three to five hours, plus any time it takes to move the data from Amazon over the network. It also imposes fees if more than 5% of total data is retrieved, as well as for outbound data transfers. Further, Amazon holds the encryption keys, which is a red flag for some security experts.
For these reasons, Glacier could be somewhat of a nonstarter in large enterprises.
“On the surface, it is seemingly more complex and troublesome than the tape archive, and only offset by the potential but clearly untestable promise of greater long-term resiliency,” said Jeff Boles, industry analyst at Taneja Group, in an email. “Glacier looks like a questionable value prop for many typical enterprise customers.”
In particular, Glacier’s à la carte pricing is problematic, said Steve Zivanic, vice president of marketing at Nirvanix, a cloud storage provider.
“Enterprises don’t want to deal with the teenage cell phone bill problem,” he said. They would rather pony up for an unlimited texting plan than be caught by surprise with a thousand-dollar monthly charge.
And its penny-per-gigabyte pricing “is totally misleading,” he said. A more realistic price for Glacier is probably in line with Nirvanix’s own 25 cents per gigabyte when you add up various access and bandwidth charges, he said.
The three- to five-hour retrieval times are another obstacle. “Customers understand that it’s a deep archive, but they’re not comfortable with the access times,” Zivanic added. Most cloud storage archives are disk-based and provide access times in the milliseconds.
Zivanic did concede that smaller companies without extensive archiving processes could go for Glacier, and he also concurred with Amazon’s anti-tape positioning.
Thanks to deduplication techniques that can reduce data by a factor of 10, he said enterprises are—if not converting existing tapes—at a minimum switching to disk-based clouds for new archives.
“Are people taking data off tape and tier-three and four storage and moving it to the cloud?” he asked. “No question.”