Google Gets Storage Pricing Out of the Clouds

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There are more than a few storage-in-the-cloud services today and more cropping up, but while Google’s Message Discovery service isn’t alone in the sandbox, it’s one of the few not basing revenue on how many bytes are crammed into its cloud.

The e-mail archive and e-discovery offering, initially released in February, is now an online service. It features security technology acquired through Google’s $625 million purchase last July of Postini.

Postini is an on-demand provider of software and services to encrypt, archive and enforce policies for e-mail and other Web-based communications. The hosted package, which is included within the Google Apps Premier Edition, supports Exchange and Lotus Domino as well as Gmail.

When it comes to online data storage, vendor tools are very similar, according to research firm Enterprise Strategy Group (ESG) and most charge based on data loads — the more data stored, the more cost to the user.

With Message Delivery, the cost is an annual subscription fee of $25 per user per year. That distinction, according to ESG, could become a standard, since pricing is a differentiating factor among vendors.

“Google’s offering is not unique from the standpoint of message archiving and discovery, as there are many other service providers that have had these capabilities for a while,” said ESG senior analyst Brian Babineau.

“However, Google is being fairly aggressive on its pricing and it needs to leverage message security services and mega-brand to successfully compete. I, for one, would not bet against the brand,” he said.

The Google cloud initiative follows several other brand name vendor moves into e-mail archiving and storage as a service. In February, Dell bought MessageOne, an on-demand e-mail archive and disaster recovery vendor, for $155 million. Yahoo spent $350 last September for Zimbra, a provider of e-mail and collaboration software. EMC and IBM have also bet big on online storage services.

Also taking the subscription approach is HP, which last week unveiled its Upline backup and access service, with pricing ranging from $59 to $299 a year, depending on the number of PCs and accounts using the service. HP also offers a fixed storage pricing plan.

Storage in the cloud is catching on for several reasons. Enterprises find tape drives and e-mail servers often become too costly and too complex to manage, and an online service provides an easy way to keep on top of backup and archiving technology.

The overriding concern with such services has been security, and that issue was the primary reason for the Postini acquisition, according to Adam Swidler, product marketing manager for Google Enterprises. The Postini software encrypts, archives and enforces policies for e-mail, instant messaging and other Web-based communications.

“Two to three years ago, it was a difficult conversation to convince business to route their e-mail into a cloud. But our patented architecture with Postini security have passed the litmus test for customers,” said Swidler.

Given the 40,000 business customers and 14 million end users using Postini software, there’s clearly a ripe marketplace for Google’s storage service. While Google won’t provide subscription figures, it said adoption is happening over a “very broad demographic segment.”

“We are seeing tremendous response and we think it’s partly tied to how we’re selling it,” said Swidler, noting that the typical cost approach involving volume discounts, number of seats and amount of data archive load is very confusing for businesses to understand.

“With a one-price subscription enterprises can clearly determine the return on investment and cost efficiency of this service versus using hardware and all the collateral costs that come with that,” he added.

Article courtesy of

Judy Mottl
Judy Mottl
Judy Mottl is an experienced technology journalist who has served as a senior editor, reporter, writer, and blogger for InformationWeek, Investors Business Daily, CNET, and Information Security Magazine, as well as other media outlets.

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