The Dominoes are Being Set up to Fall in Favor of One Enterprise Storage Cloud Provider

There is a growing body of evidence that indicates it is no longer a question of “If” enterprises will adopt cloud storage infrastructure but a matter of “When”. However pinpointing exactly when enterprise organizations will begin their broad adoption of public storage clouds is still difficult to ascertain.

It is not that enterprise organizations are unwilling to spend money on public cloud storage services or lack the budget to do so – they do. Analyst firm Gartner, Inc., forecasts that enterprise expenditures on cloud services will grow exponentially over the next four years reaching $148 billion by 2014.

Rather it appears the reason that enterprise organizations are putting off their adoption of public storage clouds is because they lack confidence that storage cloud providers can deliver them in the manner in which they need.
For example, one would expect that health care providers (hospitals, physicians, etc.) would be some of the first to jump on board the public storage cloud bandwagon. The existing Health Insurance Portability and Accountability Act (HIPAA) coupled with the new provisions in the recently signed Affordable Healthcare Act are bound to create rapidly growing data stores of Electronic Medical Records (EMR).

Add to that the increased use of higher resolution digital medical images by physicians and it would seem all of the pieces are in place to make health care a prime candidate to take advantage of the cost and efficiency benefits that public storage clouds can provide.

Yet at the recent Mass High Tech Emerging Technology Forum held in Boston, MA, attendees like Robert Buchanan, the CIO of Anna Jacques Hospital in Newburyport, MA, expressed apprehension about storing his hospital’s data in public storage clouds. He says, “It will take time for people to feel comfortable with having their personal data out there.”

This lack of comfort explains why, according to another analyst survey released in February 2010, only 3% of health care providers are using public storage clouds in any form and only another 5% were adopting it in 2010. Perhaps even more disconcerting, fully 43% of health care institutions have no interest in public storage clouds and the 43% that did express interest had no formal plans for adoption.

While it is difficult to pick out an exact reason as to why enterprise organizations are so reluctant to trust their data with public storage cloud, much of their apprehension may be rooted in the types of customers that current cloud storage providers are set up to service.
Current public storage cloud architectures have been designed and constructed to solve a very narrow set of problems that are reflective of the kinds of issues that consumers and small businesses have. It is for this reason that these providers primarily offer archiving, backup and file sharing services.
In this respect, public storage cloud offerings from the likes of, FilesAnywhere, Flickr,, Mozy, and Photobucket have been a boon to end-users, professionals working from home and small businesses. These individuals and businesses now have access to services that they could never build for themselves or otherwise afford.

But these public storage cloud services to which these users subscribe are designed for use by the masses. As a result, their users are given few if any options to reconfigure these public storage clouds to meet their specific requirements for availability, data protection or performance.  So while this approach may be acceptable to this class of users, it is largely unacceptable to enterprise organizations which probably explains their low rate of adoption of cloud storage solutions.
Stories about outages and suspension of public storage cloud services only exacerbate the concerns that enterprise organizations have about storing their data with public storage cloud providers. Outages at major public storage cloud providers such as Amazon in 2008, Google in 2009 and EMC Atmos Online in 2010 stretch their confidence that providers can support them.
Then terminating public storage cloud services such as what EMC recently did with its Atmos Online only harden their resolve to proceed cautiously so as not to lose their organization’s data in the cloud.

Storage clouds are the future of storage and I am convinced that over the course of the next decade every enterprise organization will adopt storage clouds to one degree or another. But because of these current issues with public storage clouds, it is not surprising that enterprise organizations are gingerly moving forward with cloud storage if they are adopting it at all.

What is worth monitoring is what will be the event that triggers a change in this status quo. Enterprise organizations closely watch what their counterparts at other organizations are doing and right now when they look at what they are doing in regards to cloud storage, they typically find their counterparts looking right back at them.

But should one storage vendor get some deployments in place and then obtain those critical referrals from customers who are viewed as the industry leaders, watch out. A rapid swing towards a specific cloud storage provider could happen in much the same way that a swing towards a specific server virtualization provider (VMware) occurred.

Should this occur, do not be surprised to see cloud storage adoption among enterprises quickly gain momentum and the dominoes begin to fall heavily in favor of that one cloud storage provider that gets those customer references.

Click Here to Signup for the DCIG Newsletter!


DCIG Newsletter Signup

Thank you for your interest in DCIG research and analysis.

Please sign up for the free DCIG Newsletter to have new analysis delivered to your inbox each week.