At what point does the online backup market become saturated? I ask myself that question at least once a week. The reason: I get flooded with emails, voicemails and press releases about managed service providers and resellers signing up for online backup services.
The latest example: Pro Softnet Corp. says its IBackup service now has more than 2,000 reseller partners and 150 new resellers are signing up per month.
Here's how managed service providers can continue to compete -- and differentiate -- in the managed storage market.
Reasons to worry: In some ways, backup is becoming a commodity. Everybody from Amazon.com (Simple Storage Service, or S3) to iBackup to Symantec (the Symantec Protection Network) has introduced online backup services. And companies like Vembu have introduced software that VARs can use to deploy their own managed storage services. At the same time, more than 70 percent of our MSPmentor 100 companies offer some sort of online backup service to their customers.
Opportunities Ahead
Now, for the potential good news: Clearly, more and more small and midsize businesses are willing to move their data off site. Fact is, small businesses want a strategy to lower their data management costs while also increasing data protection.In other words, managed service providers are facing less and less resistance -- but more competition -- when they pitch managed storage services.
And don't forget: The typical business sees its storage needs double every 12 months or so. Even as prices drop amid competition, the total managed storage market will continue to grow. Check out this chart to see how a typical business may see its data grow on an annual basis.
Change Your Messaging
As more competitors move into the market, you'll need to shift to new storage opportunities, including corporate compliance, contingency planning and eDiscovery -- where your services allow a small or midsize business to more effectively store and retrieve information at a moment's notice.eDiscovery is particularly critical to law firms, health care organizations, financial firms and insurance companies that may need to retrieve old, archived information at a moment's notice.
Also, steer clear of "cost per gigabyte" conversations, because you won't be able to compete dollar-for-dollar (or, actually, penny-for-penny) against big consumer online storage services.
