Free Cloud Storage: Customers Get What They Pay For

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Even companies like Amazon offer bare-bones storage as a service for 8 cents per GB, Bernard said.

"I'm not a fan of any IT price moving to zero dollars," he said. "You can get a solution, but someone needs to get paid for the development. With free storage, I'd question who is storing the data, how it is protected, and whether it is recoverable. And sometimes that is hard to explain to the customer."

Alvarez said he can understand why customers consider free services, given that some of the best-known providers such as Carbonite and Mozy, which do a big part of their business through reseller partners, heavily advertise the free part of their service to attract customers on a trial basis.

However, he said, such free trials are still fraught with the risk that backed-up data might not be able to be restored, Alvarez said. Free services also may not provide quick upgrades and patches, he said. "And customers are notorious for leaving things the way they are, and not proactively looking for upgrades and patches," he said.

Alvarez works with cloud storage partners like eFolder and Axcient, whose services are connected to platforms like ConnectWise and Level Platforms, in order to make sure they can be managed properly.

The biggest argument against free cloud storage is the question of whether customers in certain fields would be in compliance with regulations concerning the storing of data.

This is an especially important question for customers in the medical field, said Zac Childress, president of DarwinTech, an Oxford, Mich.-based solution provider.

Doctors face many regulations related to protecting customer data, including HIPAA regulations on privacy, Childress said.

"Doctors need a business provider agreement to be compliant with HIPAA laws," he said. "When a provider signs that agreement, they become liable for a breach in security. The provider gets to share in the liability. Most free storage providers don't realize that."

Doctors should know about this requirement, but not all of them do, Childress said. "A lot of doctors either don't care about it, or don't understand it," he said. "Part of my service is to help them understand. If a doctor asks me about a free storage service, I tell him or her that if they want to be in compliance, they can't sign up with the free service. The ones who understand that the paid storage solution is worth the investment will sign up for it."

Childress said the safe way to offer such a service to medical providers is to work with a third party like Toronto-based Manta Group, which can sign business provider agreements with such customers.

Compliance with health care regulations has in the past been poorly enforced, but the government is now adding teeth to regulations such as HIPAA, Alvarez said. "So customers are more interested in following the rules," he said.

However, there are still many medical providers who don't realize that they may be out of compliance, Alvarez said.

"We just took on a small dentist practice with one server and a dozen PCs," he said. "They had been using Mozy. But we found out the customer had never backed up its SQL database, or tested its restores. This wasn't a Mozy issue; it was a problem with the previous provider."

Alvarez said that the dentist office serves as a reminder that not all solution providers are up-to-date on requirements. "Lots of providers don't fully understand the customer requirements, or don't do test restores or configuration checks, or the many other things we do to make sure customers are taken care of," he said.

Next: Knowing When To Walk Away

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