April Understanding the Benefits of Cloud Backup/Disaster Recovery Solutions

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1 April 2014 S P E C I A L R E P O R T Understanding the Benefits of Cloud Backup/Disaster Recovery Solutions

2 Table of Contents Introduction... 3 Why Invest in Backup/DR Solutions?... 4 How Does Cloud Backup/DR Work?... 5 Why Use Cloud Backup/DR?... 6 What Should You Look for in a Cloud Backup/DR Supplier?... 8 How Much Will Cloud Backup/DR Cost?... 9 What Are the Challenges With Cloud Backup/DR? Cloud Backup/DR Solutions 2

3 Introduction Every year, organizations are generating more and more data. IDC predicts the number in the United States alone will grow from 898 exabytes in 2012 to 6.6 zettabytes in 2020, doubling about every three years thanks to continued Internet usage, smartphones, social networking and M2M, including security images and information about information, IDC said in its February 2013 report, The Digital Universe in That means there s more information than ever to protect. And not backing up files and applications can lead to devastating consequences. For instance, 600,000 laptops containing confidential and sensitive information are stolen each year at airports in the United States. That s according to a 2008 study from the Ponemon Institute and Dell. And 93 percent of companies that lost their data centers for 10 days or more filed bankruptcy within five years, the National Archives & Records Administration in Washington, D.C., found. Such findings demonstrate that it s past time for SMBs and enterprises to reevaluate their backup/disaster recovery strategies. And it s safe to say the era of on-premises-only backup via tape or disk has met its end as its greatest challenger, the cloud, reaches maturity. The cloud offers automated, third-party-administered, subscription-based services that let businesses either rely just on the cloud or employ a hybrid approach. Either way, IT departments are freed to tackle strategic projects instead of focusing on time-consuming tactical duties. Cloud Backup/DR Solutions 3

4 Why Invest in Backup/DR Solutions? Every minute your company is down, you are losing business. The ability to quickly recover key servers and applications ( , CRM, financial records, etc.), and get back to normal operations, is critical. And the statistics support that assertion. According to insurance giant The Hartford, which published its Business Continuity Management Plan for clients in 2003, here s what to expect: Of companies that experience a disaster but have no business continuity plan in place, 43 percent never reopened. 70 percent of businesses that closed for a month or more failed to reopen or failed altogether within three years. Most companies that must operate 10 or more days without their computers will never fully recover. Now, most SMBs are not looking to replace their storage and disaster recovery architecture with an all-cloud alternative. Many have invested too much money and time in hardware to toss it. However, knowing the drawbacks of technologies such as tape and disk, there s much to be said for adding a cloud component to ensure a wellrounded approach in case something goes wrong on the premises side. Indeed, there are common problems associated with tape- or disk-only backup. To that point, the following are typical: Manual administration creates a high error risk. Getting data back can take hours, days or even weeks. High total cost of ownership Inflexibility If a disaster is severe, the original backup system also can be destroyed, taking all backed up data with it. As a result, experts tend to recommend a hybrid approach on-premises and cloud, also referred to as as-a-service to data backup and disaster recovery. It s not surprising, then, that the forecasts and drivers for cloud-based adoption are significant. Know the Lingo As you consider backup and recovery solutions, you will encounter several terms that you should understand in determining what will best fit your needs. Business continuity (BC) serves as an umbrella term for keeping an organization running during and after a disaster. The term encompasses more than technology, going so far as to include matters such as physical escape routes for employees. Disaster recovery (DR), meanwhile, is concerned with restoring any lost operations and systems. Backup replicates data and stores applications and their associated files for retrieval. Cloud Backup/DR Solutions 4

5 How Does Cloud Backup/ DR Work? The most typical approach to cloud backup/disaster recovery is simple: An IP WAN connects an organization s network to a service provider s data center. The data storage system manages that information from remote clients and maintains the repository where backed-up data live in case recovery is ever needed. How It Works: Cloud Backup/Disaster Recovery VMWARE VMWARE VMWARE Replication Storage EMC NET APPS EMC HOST BASED REPLICATION NET APPS 1 Customer or Provider Site 2 Continually Updated Replicas Cloud Recovery Public or Private VMWARE VMWARE 3 BLOCK Managed Recovery of Servers 4 Continuity of Service In this illustration, data are backed up from the customer s network to the service provider s facilities, where they are replicated and updated so that if recovery is needed, there is little or no service interruption. Source: Windstream Cloud Backup/DR Solutions 5

6 Why Use Cloud Backup/ DR? The worldwide recovery-as-a-service market will grow from $640.8 million in 2013 to $5.77 billion by 2018, according to March 2013 statistics from MarketsandMarkets. That makes for a compound annual growth rate of 55.2 percent. Meanwhile, cloud storage, which MarketsandMarkets defines as including backup and disaster recovery, will experience similar increases. The research firm in December 2012 predicted the global cloud storage sector will see a compound annual growth rate of 40.2 percent between 2013 and The reasons are straightforward. SMBs want to integrate cloud storage, including backup and disaster recovery, to ensure their data stay secure, updated and accessible no matter what. Such resiliency is an increasingly critical priority, Forrester Research analyst Rachel Dines wrote in a January 2014 blog, Disaster Recovery Service Providers Demystified. In fact, it was the No. 3 overall infrastructure priority moving into In a similar vein, a recent survey conducted by market research firm Vanson Bourne for cloud backup vendor EVault showed that, in 2012, 53 percent of 650 IT decision makers reported data losses within the past year. That figure compared to 31 percent in The soaring percentage of data losses and the ever-present threat of disasters creates a striking call to action for organizations to incorporate the cloud. Of course, security and resiliency are not the sole justifications for cloud backup and disaster recovery. Supplementing onpremises backup with cloud platforms also cuts down on the amount of money organizations will spend on IT infrastructure, MarketsandMarkets noted. In an era of continued financial uncertainty and the unrelenting need to please shareholders and investors, a number of SMBs are switching spending from Projected Recovery-as-a-Service Growth $ MILLION IN 2013 their capital expense to their operational expense budgets. Cloud even can reduce overall costs, but that is not always guaranteed. Other advantages of cloud backup and disaster recovery include high levels of automation, around-the-clock support, and ease of use, management and recovery. $ 5.77 BILLION IN 2018 Source: MarketsandMarkets, March 2013 Cloud Backup/DR Solutions 6

7 Cloud Backup/Disaster Recovery Drivers Security Regular data updates Capex-to-opex budget conversion Can run more cheaply than than on-premises systems Automated 24/7 support Easy to use Source: Channel Partners, April 2014 With all of that in mind, SMBs will want to know how to choose cloud backup and disaster recovery suppliers, how to understand the pricing methodology and be aware of potential challenges. Cloud Backup/DR Solutions 7

8 What Should You Look for in a Cloud Backup/DR Supplier? The popularity of cloud services has attracted hundreds of newcomers and old timers to the space. Not all of those vendors are equal. Not all of them have enough money or offer the in-demand technologies to sustain themselves in the midst of intense competition. For example, in 2013 alone, two brands, Nirvanix and Backup Exec.cloud, shut down unexpectedly. Nirvanix could not afford to stay open and Backup Exec.cloud, part of Symantec, did not offer file synch and share, or mobile access. Thus, it is critical to consult with your PlanetOne partner to pinpoint the cloud providers that have been in the communications field long enough to prove themselves, that are financially stable and that offer the backup and recovery features you require. In some cases, these will be network and hosted services providers such as CenturyLink, MegaPath, Windstream and XO Communications that: Operate data centers, overseeing security, regulatory compliance and more Provision network connectivity Offer public, private and hybrid clouds Charge on a subscription, rather than upfront basis Are able to scale user capacity and storage as needed Cloud Backup/DR Solutions 8

9 How Much Will Cloud Backup/DR Cost? The cost of cloud backup depends on components including storage, bandwidth and/ or number of users, and even frequency of data retrieval. In general, cloud backup is procured on a per-gigabyte, per-month basis. Expense varies based on the age of the data, the type of data ( , databases, files and so on), volume, number of backup copies, recovery time objectives (RTO), recovery point objectives (RPO) and tolerance for downtime. RTO: This considers how quickly systems need to be back up and running. Typically, the longer the data restoration process takes, the cheaper the price tag. RPO: This analyzes how much data the organization can afford to lose. Daily backups might mean the loss of 24 hours worth of information. More frequent and more expensive backups will cut losses to almost zero. Cost of downtime: How much does an hour of downtime cost an organization? For instance, if downtime costs you $100 per hour, you can afford an RTO of hours or days. But if downtime means missing out on thousands of dollars per hour, then the RTO must translate into seconds or minutes. MegaPath, in its white paper, How Downtime Can Affect Your Business and How to Avoid It, states that small businesses, on average, stand to lose $12,500 per hour of downtime. Further, the company wrote, The average loss of profit for all businesses per hour is a staggering $212,000. Suppose a business has their server down for an entire eight-hour business day that represents an average potential loss of $1.7 million, or $100,000 for a small business. In that light, consider this case study success story from XO Communications. The Bank Administration Institute (BAI), a financial services association, recently adopted XO s Enterprise Cloud platform. BAI then simulated a disaster situation to test its new RTO of systems including CRM, and databases, and servers. The timing went from two weeks to two days. The cost of cloud backup depends on components including storage, bandwidth and/or number of users, and even frequency of data retrieval. Cloud Backup/DR Solutions 9

10 There are other elements that can change the price of a cloud backup/disaster recovery platform, too. Service level agreements (SLAs). SLAs guarantee uptime and availability. They also ensure refunds if the service provider loses your data. Not all suppliers offer SLAs. Consult your PlanetOne adviser if this is important to your organization, and expect to pay more if an SLA is included in your cloud backup/disaster recovery platform. Private cloud. If your organization must comply with regulatory requirements such as HIPAA or PCI, you will need to deploy a private cloud, which operates independently of other companies storing their information in a data center. Private clouds generally cost more than multitenant arrangements. Cloud Backup/DR Solutions 10

11 What Are the Challenges With Cloud Backup/DR? When an organization first starts sending files to the cloud for backup, the process can take some time, depending on how much data are being transferred. For example, moving 1TB of data on a 40Mbps connection would take about 53 hours, according to one Internet tool, calctool.org. This estimate does not consider an organization s processing power, which can impact data transfer speeds as well. Next, keep in mind that once the initial data dump is done, most cloud backup services then only update files that have changed since the last backup. This cuts down on the time spent on a backup and may also allow your organization to scale its bandwidth back down until such time that it needs to be ramped up again. Cloud Backup/DR Solutions 11

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