Data storage warning
for telcos

22 May 2006

With regulatory compliance driving the need for businesses to hoard vast amounts of data as well as the 60pc annual growth of unstructured data such as email in the enterprise, company owners will struggle to derive business value from their investment in storage systems, senior IT executives have told

“The real problem for business owners about investing in storage is that there doesn’t appear to be any value above and beyond dealing with compliance,” said Howard Roberts, principal consultant with EDS.

Nonetheless, firms are struggling to cope with increasing volumes of data being generated every year. For IT companies such as IBM, EMC and Dell, storage is a booming business.

While most businesses will endeavour to develop a storage strategy, telecoms firms and internet service providers (ISPs) risk being financially crippled by the passing of the draconian EU Data Directive, which obliges firms to store the call and internet data move of every EU citizen for at least three years.

Research by the University of California presented by EMC at its annual conference in Boston last month revealed that a mere 20pc of information contained on enterprise servers is structured data, the rest such as email and old web content, is unused but has to be retained for regulatory compliance and legal purposes.

“The good news is that the cost of storage has reduced dramatically in recent years. The bad news is that all the data that will be amassed by companies needs to managed,” says Nigel Tozer, a business technologist with Computer Associates Ireland. “80pc of the data in a business you don’t need on a daily basis but finding that data when you need it will be a real problem.

“That means smart ways of managing data and getting instant access to old data need to come on stream. For compliance and regulatory purposes as well as legal issues you need to capture every email and backups won’t do the job for you. Email archiving and search and discovery tools will need to be deployed.

“New storage technologies are coming on stream such as ‘write once’ disks, whereby no email or document can be deleted or ‘disappeared’, as well as self-managing archive systems,” Tozer added.

Alan McMahon, enterprise marketing manager at Dell Ireland, said that the Irish market is one of the leading markets in Europe in terms of growth of the storage market. “The use of email has expanded dramatically and firms are investing in file storage and archiving tools. This is primarily being driven by regulatory regimes like Sarbanes-Oxley. The amount of data in organisations is set to increase exponentially with the regulatory need to store multimedia ranging from images to video conferencing, security and IP communications. Another issue that will arise will be storage security in terms of ensuring that documents, once stored, won’t be tampered with or altered.”

McMahon agrees that the cost of storage technology is falling all the time. “Two years ago to buy a system to store one terabyte of data would have been €80,000. Today a system capable of storing one terabyte can be bought for €5,000.”

Despite the falling costs of the equipment, managing this data will present strategic issues for most companies but for telecoms firms it could be a financial nightmare.

“Compliance and regulation will be the driver of the storage market in the years ahead,” said John Murphy, director of EDS Ireland’s global field services group. “In terms of the need to hold call data records under recently passed legislation, the challenge it presents to telcos without any obvious business value is quite frightening.”

By John Kennedy