Iron Mountain Digital Authority

to electronic discovery. Companies often are expected to produce not only the most recent version of a file or document, but also the corresponding metadata that shows who revised the document and when. They must also be able to demonstrate that they have a comprehensive records management policy in place, and that they routinely follow it.

Regulatory compliance is another issue. All public companies in the United States are subject to the Sarbanes-Oxley Act, which sets mandates for financial reporting, while companies in many industries may have to comply with additional regulations that force them to keep certain data. Health care companies, for example, must retain electronic medical records data on all patients, and much of that data is unstructured. “We keep all essential data as it relates to a patient’s electronic medical record indefinitely,” says Ken Bixel, CIO and vice president for Mount Nittany Medical Center in State College, PA. “As a result, we retain all of that lifetime data. Although people may go for extended periods of time, sometimes many years, without utilizing our services, or even die, so long as they were here at one time, we retain their record indefinitely.”

Then there are those organizations that keep all data simply because they don’t have the time or inclination to weed out what’s unnecessary. “Much of our unstructured data tend to be early revisions of things, and you don’t need all those versions,” says Chuck Currier, vice president of IT for the College of DuPage in Glen Ellyn, Ill. “You need the final version but no one knows what the final version is, so you keep all of them. We have over a terabyte of data just in our file server that encompasses versions of Word documents, Excel spreadsheets, presentations and things like that.”

The true cost of storage

Most companies don’t have a firm grasp of just how much storage is costing them because they fail to take into account one or more factors. Steve Blumenau, vice president at Iron Mountain, says Iron Mountain Digital typically walks customers through an exercise that helps illustrate the true cost of storage.

The first consideration is storage hardware, including servers and disk arrays. When calculating hardware costs, companies should consider their rate of storage growth, which is typically 30 percent to 50 percent. At that rate, how quickly will a given storage array or file server reach its maximum capacity, forcing the purchase of additional hardware?

Next is software. Some organizations use the management software that came with their storage management arrays, but about half use third-party software and typically pay a fee based on storage capacity under management. They also pay for the client software that

“Total storage costs are t wo to four times acquisition costs,” says Steve Blumenau, vice president at Iron Mountain Digital.

runs on each file server. “As they scale up the storage environment, storage management software costs go up,” Blumenau says.

Hardware and software products typically include maintenance fees too. For a storage array, companies often pay for three years of maintenance up front, so the costs are essentially hidden. During one workshop, Blumenau found a customer was paying $80,000 in storage array maintenance fees in year four, after which the array reached the end-of-life phase. In year five, support costs doubled to $160,000.

Then there’s the cost of the facilities in which the storage equipment is housed. Real estate costs make up the bulk of that tab, but power and cooling costs also factor in.

Similarly, storage puts a burden on network infrastructure. That includes both the storage network within the data center and, to the extent data has to be backed up, the telecommunications links that extend to the wide-area.

Staffing is the final consideration. As with infrastructure costs, reducing storage requirements can limit the number of staff companies need to hire to keep up with growth. If, for example, a company needs one administrator for every 500 terabytes of data under management, it’s a simple matter to calculate how many administrators will be required if current growth rates are left unabated.

As customers walk through such a cost exercise, they won’t likely be surprised at any one item, but they are often taken aback by how they add up to show that total storage costs are two to four times acquisition costs, Blumenau says.

“So if I bought an array for $100 under a three-year contract, it’s going to cost me four times that, or $400, to own it over that time period,” he says. “You see these numbers get printed by analysts, but to see it play out kind of surprises people.”