Asigra CEO: The Future of Backup and Recovery Pricing
The cloud backup market has grown more crowded and customers are buying on price, Asigra CEO David Farajun acknowledged during his keynote presentation to partners at the Asigra Cloud Backup Summit in Toronto today. But as the market has grown, so has the 26-year-old cloud backup provider which Farajun said is approaching 1 million customers. And with that customer momentum Farajun spelled out his vision for Asigra, the market, and the future of cloud backup. Here’s the scoop.
Farajun said that he sees a future where the price of backup is unbundled from the price of recovery. That’s because pricing in the cloud backup market is going to drop in a more crowded market eventually getting closer and closer to the cost of the disk itself. That’s not good news for partners as margins will shrink accordingly. But only 10 to 20 percent of customers ever use the recovery function of their backup and recovery solution while 80 percent never use it. That means they are paying for something they don’t ever use, Farajun said.
Customers Buying by Price
“As you know our market is growing and unfortunately many customers are buying by price,” he told partners. “We are thinking data protection software companies are charging too much, including Asigra… Because of competition the market will drop down to the value of the disk. A 1 terabyte disk costs about $100.”
That’s why Asigra is looking to the unbundled model where recovery and value-added services cost more (and are more profitable) than the commoditized backup alone. Asigra is offering this new pricing option to partners, but the company won’t take away the more traditional pricing model of bundling backup and recovery together.
“The only way we can succeed is to add value. Protecting data has two processes,” Farajun said. “One is backup and one is recovery. If we can distinguish between the two processes, I think the market will be far bigger because the cost of backup will be lower. Cost of recovery, you will use it when you need it.”
Asigra Technology Updates
In addition to providing vision about future pricing, Farajun also offered a look at some of the technology vision for the Asigra Cloud Backup solution. The next version will include more than 3,500 unique products and features to protect and recovery data, he said. Some of the big new focuses will be the ability to manage snapshots for Big Data; virtual disaster recovery, both local and remote; NOC configuration and monitoring; and data analytics to optimize technology refreshes.
Asigra plans to offer a single core SKU and then break the pieces to enable partners to customize solutions for customers. In addition, Asigra will add more plugins, APIs and libraries to help partners further customize solutions. That will help going into the future to differentiate partners’ value-added services.
Will Asigra’s new pricing model that unbundles recovery from backup make sense to partners and customers? MSPmentor will be watching.