Offsite backup and recovery: Understanding the hidden costs

By JASON YAEGER
Online Tech Director of Product Management, Risk Management Officer and Security Officer

The cost of data loss can be staggering. A study at the University of Texas tells us that 43 percent of companies that experience a catastrophic data loss never reopen, and that another 51 percent close the doors within 10 years.

For small- and medium-sized businesses, the cost is even more staggering: 70 percent of companies with fewer than 100 employees that experience a catastrophic data loss go out of business within a year, according to DTI/Price Waterhouse Coopers.

Smart companies know offsite backup and IT disaster recovery are necessary priorities, but those with first-hand experience knows it can be both complex and unreliable. According to the Boston Computing Network, 77 percent of companies who tested their backup tapes discovered failures. Gartner tells us that 50 percent of backup tapes fail to restore. Companies need reliable offsite backup and recovery options that don’t break the bank to protect data.

Part of controlling costs for your company’s backup and recovery solution is to start with a thorough risk assessment to prioritize what systems are most important to protect. Loss of critical systems tied to daily revenue can be devastating, but chances are that some data, such as archives, can afford a longer recovery process. Start with understanding what systems must be restored immediately compared with those your business can afford to wait on for a while.

What does backup and recovery cost?

Easily quantifiable backup and recovery costs may include one or more of the following:

• Backup IT Infrastructure. This includes capital expenses such as data storage, application software and networking, as well as the maintenance costs associated with that equipment.
• IT Backup Operations. Operational costs include systems management and administration, as well as reporting.
• Data Center Costs. The footprint of your backup infrastructure in the data center creates associated facilities, power and cooling costs.
• Offsite Data Logistics. Associated costs include transportation as well as storage and handling fees.

These items – infrastructure, operations, data center footprint, and offsite storage – form the basis of your backup TCO, but don’t paint the whole picture. There are hidden costs that don’t always make it into the proposal when you’re implementing a new solution.

Make sure to account for the following costs of offsite backup and recovery solutions, as well:

• Business continuity and disaster recovery planning and risk assessment. Yes, it costs more, but without it, you may up spending more on non-essential systems while sacrificing the protection of critical systems.
• Increased operational complexity. It’s hard enough to track everything in the production environment. Add a whole new recovery environment (one you hope to never use) and the burden on your people and processes increases exponentially. If you don’t account for the increased demand on your time, you’re likely to find out that your production and backup environments are out of sync at the worst possible moment: during a recovery situation.
• Greater preparation for regulatory compliance, encryption and audits. If your protected data is subject to regulations like HIPAA, PCI, SOC 2, or EU-US Privacy Shield, don’t forget that you must add the backup environment to your audits. Many regulations call for offsite backup; make sure your environment meets your standards. Are you adding encryption? Make sure to account for potential performance issues for your production systems and test a full backup to verify you can complete a backup within your allotted window.
• Cost of media. If your organization relies on traditional tape backup, factor in your media costs for the volume of protected data your organization will have one, two and five years from now.
• Recovery time. Part of a good Business Impact Analysis includes a realistic look at the impact to the business during recovery time. If your business loses a single critical file, and you are forced to restore an entire server or wait for the backup tape, consider the time and money being wasted. Compare this to file-level restoration options that allow the recovery of a single file within minutes of an online click. By the same token, if you know the cost to the business of a critical system, it lets you make better decisions about how much to spend to protect it.
• Duplicate data storage. Many situations call for both an onsite and an offsite backup. Factor in everything above again if you must maintain both.

Total Cost: An example

Each business has its own unique offsite backup and recovery needs, but I’d like to share an example from our own experience.

When Online Tech first made the transition to leveraging enterprise cloud for offsite backup and recovery years ago, we were able to reduce our redundant stack of backup servers from 23 to two. As you can imagine, the capital savings alone were compelling. Add in the hassle of maintaining all of those servers and periodic replacement, and you can see that any organization using multiple physical servers for offsite backup can benefit from the efficiencies that cloud based backup and recovery offer.

We didn’t just save resources; we saved time. In our redundant stack of 23 physical servers, actually completing a fail over test was a challenge. In the cloud, we had critical systems back online in 45 minutes, with all systems back within four hours. Even better, we are able to spin up new cloud servers quickly. We can even put small clouds on standby where we can amplify resources in a matter of minutes as an alternative to either spending the money to maintain completely redundant infrastructure or waiting days or weeks for new physical servers to arrive.

Moving from traditional physical backup and recovery paradigms to cloud based backup and recovery isn’t just an efficiency improvement, it’s an entirely different mode of protection.

Today’s enterprise backup and recovery solution affords us additional savings with deduplication to reduce backup windows further, along with the nuanced control of being able to restore just one file in the event it is accidentally lost or damaged. As anyone who has had to restore an entire snapshot image will tell you, it is much faster to click the button to bring back a single file than it is to restore an entire server. Waiting for that same file from a tape backup? Prehistorically slow.

If you have questions about transforming your organization’s offsite backup and recovery, here are more resources that may prove helpful:

White paper: Disaster Recovery

Online Tech’s Offsite Backup and Recovery

Webinar: Technical Disaster Recovery Implementation