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How cloud impacts the future of pricing models and data compliance

By December 13, 2016Article

A deluge of untraceable, unstructured data has altered the way organizations approach many critical components of today’s businesses – including data storage and backup.  

As businesses continue to produce more and more data, particularly unstructured data, at an increasing pace and store it across multiple places, it is quickly becoming a strain on existing systems. This growth of data has outpaced storage capacity and increased risk to businesses. In 2017, we’ll see how this affects not only technology, but also the business models that service providers employ. 

The move to consumption-based pricing models 

The adoption of cloud-based services is creating new challenges and opportunities for both enterprises taking advantage of cloud-based solutions and the vendors offering them. In response to enterprises shifting expectations, more backup and recovery software companies are charging for services based on the concept of consumption-only pricing. The concept simply means that companies are only paying for what data is ultimately stored within the service, and nothing else, providing complete price transparency. 

Complex pricing models are not a thing of the past, even in the cloud; but we all look forward to the day they retire with that moniker. For legacy on-premises architectures being used in the cloud, the lack of storage efficiencies and elasticity forces vendors to make up cost differences through complex pricing models. While these models typically provide inexpensive up-front costs, they also impose a stiff penalty when customers need to retrieve their data in an emergency.  

Additionally, they apply storage limitations on retention, which can force customers to follow a vendor’s retention model or pay more than expected for data that must be held long term for compliance purposes. Until recently, this was the only option enterprises were able to choose when looking at cloud storage and backup solutions.  

Changing times 

The evolving sophistication of backup and recovery technology and the utilization of cloud as an operating system rather than a storage medium makes it possible to significantly remodel cost structures. 

With cloud-native technologies, extreme cost efficiencies can be realized. We’ll start to see cloud vendors benefit from technologies such as:

  • Automatic storage tiering that moves data to lower-cost cloud storage levels based on data usage characteristics
  • Deduplication that removes copies of data and can be applied globally across all servers and devices
  • Ever-incremental backups that eliminate the need for regular full backup copies. 

For legacy architectures, the possibilities afforded by these cloud-native technologies aren’t available without significant investment and redesign. 

The changing times will ultimately benefit the customer and consumer of data. Moving cloud-based data protection services from legacy pricing models to “pay-only-for-what-you-use” pricing plans will evolve the entire landscape of cloud-based offerings. True consumption-based licensing models give customers greater budgeting predictability and ultimately reduce overall costs quite significantly.  

New payment approach appeals to age of proactive compliance 

In 2017, we will see a higher demand for software that not only backs up data but also proactively crawls databases and devices to ensure that all organizational data meets global privacy requirements. With increasing awareness to, and enforcement of U.S. HIPAA breach fines and the EU’s GDPR coming to fruition in May 2018, proactive global compliance is top of mind for many organizations.  

Today’s enterprises are highly dispersed with more than 40 percent of data residing in the cloud as well as on laptops, tablets and smartphones. While the mobile workplace has untethered workers from the office, this doesn’t absolve companies from adhering to and strictly enforcing data governance policies. The growth in mobile dispersion among workforces, the ever-increasing pressure to stay one step ahead of the compliance curve and global data privacy (not to mention industry-specific regulations), and the need to have data at the ready in any situation that presents itself, makes it extremely risky to purely rely on reactive compliance strategies. 

The consequences of noncompliance are at an all-time high. Relying on traditional, reactive approaches to compliance is no longer viable in today’s world. In 2017, more enterprises will adopt a proactive approach to compliance so they are better armed to identify and remediate data risks before they become much larger issues. Unlike a reactive approach, organizations can automate finding data risks either related to industry regulations, such as GDPR, or based on their own criteria. 

As organizations double down on strategic efforts around governance and archiving, they will prioritize software providers that help them better consume cloud-based data protection services and scenarios. 

Dave Packer is VP of corporate and product marketing at Druva. Dave has more than 20 years of experience influencing products in the enterprise technology space, primarily focused on information management and governance. At Druva, Dave heads corporate and product marketing, which serves an integral role leading product definition and direction. Previously, Dave held executive positions at Autonomy Corp., Interwoven Inc. and Silicon Graphics.









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