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Year In Review: Cloud Storage's Silver Lining

While many technologies blamed the laggard economy of 2011 for their failures, cloud storage was one of the few that could point to it for its success. Numerous IT organizations, facing data growth due to factors such as the requirement to keep data for electronic discovery purposes, found themselves with growing storage requirements yet smaller budgets. But cloud storage
systems and services helped users deal with the uncertain economics of 2011 by letting them fund that growth using operational expenditure funding, rather than having to make capital expenditures in the hardware, software and people required to run one's own data center.

"While cloud was one of 2011's most dominant IT topics, the market success/penetration of many cloud services and technologies was obscure, at best," says Charles King, principal analyst, Pund-IT. "A notable exception was cloud storage, whose uptake continues to be strong. In part, this is due to the understandable value proposition of such services. Businesses and consumers alike understand the voracious growth curve of storage, with hard drives becoming ever more capacious and data creation/consumption devices, including digital cameras, creating larger and larger files. Cloud storage
offers workable, affordable benefits for these situations and many others."

Dick Csaplar, senior research analyst, virtualization and storage, for the Aberdeen Group, wrote in his November 2011 report How Much of Your Data Should be in the Public Cloud? that data is growing 32%. Meanwhile, 15% of companies in a June study reported their data growing between 80% and 100% annually. One pressure driving businesses to cloud storage is the escalating cost of IT infrastructure. "While 49% of overall respondents selected this pressure, 71% of large enterprises reported this pressure, making this the most significant pressure affecting that segment of the market," he says.

Many services started offering cloud storage ranging from the consumer to the large organization. "A host of cloud storage business services continued to see strong uptake, including Box, Mozy, DropBox and Amazon's Elastic Cloud," King says. "These are anything but one-size-fits-all solutions--most tend to target specific use or business cases, allowing companies to choose those that best fit their needs." This is particularly true for small businesses, King says. "This is no surprise because the tangible cost benefits of cloud computing are just what the doctor ordered for SMBs struggling with a tight economy and steadily rising IT expenses." In addition, cloud storage offers SMBs an economical way of performing disaster recovery, Csaplar says.

Figures from Techaisle, an SMB-focused research firm, confirm this. "SMBs globally spent $11 billion on cloud computing in 2011, growing at a compound annual growth rate of 12% until 2015," the company says. According to the firm’s research, a logical progression of services adoption is emerging among SMBs, with storage and security leading the way. "An estimated 138 million SMB employees are expected to use some form of cloud by the end of 2011. Among the mature market countries, the U.S. will have nearly one in four SMB employees using cloud technology."

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