In the Cloud: Storage Meets Collaboration

by Gerry Blackwell

Share, edit and store your documents – without investing in a whole lotta hardware.

Most business owners need a safe place to store and easily access vital data, and many also need to share documents ‑ or collaborate on their creations ‑ with remote colleagues, customers or suppliers. If that's true for you, the solution could be in the cloud.

That’s cloud, singular – geek lingo for the part of a network that you’re connected to and that provides essential services, but isn’t directly under your control. Web 2.0-style “cloud services” or SaaS, including online backup and collaboration, may be the solution to any number of storage challenges small businesses face.

Companies such as Hewlett-Packard's Upline, Egnyte Inc. and Box.net offer very inexpensive and easy-to-use pay-by-the-month (or year) solutions that combine data storage, document collaboration and, in the case of Upline and Egnyte, automated online backup. In effect, they give you a virtual online file server.


For as little as five dollars a month for unlimited storage capacity (Upline), you can use Web-based software that lets you securely upload files to the service provider’s computers and then make them available to other people over the Web. No more e-mailing documents back and forth. No more transporting backup tapes to a safe offsite location.

With some services, collaborators with the right permissions can edit documents and re-store them on the online file server. Some keep track of and automatically preserve earlier versions and even notify you of changes as they’re made.

Your files are always available, from anywhere you or authorized collaborators have access to the Internet, anytime of the day. If your office is flooded, burns down, you can't get to the office because of snow, or if your computer crashes and dies and you have to replace it, your data is still available.

Consultant John Sloan, a senior research analyst at Info-Tech Research Group, a firm that focuses on small and medium-size business IT issues, urges small companies to exercise due diligence if they’re considering such services, but he believes they can deliver real benefits.

“Right now,” Sloan said, “I see a definite value proposition in services like this for small businesses, especially ones that don’t have the size yet to invest in their own [computer and network] infrastructure, and don’t have an IT department.”


Even if a small business is big enough to have an IT department and its own network infrastructure, these services are a lot less expensive, according to Egnyte co-founder Vineet Jain. He estimates the annual cost of an onsite file server that employees could access over the Internet at $7,000. For a five-person company, the cost per year for Egnyte is $900.

This kind of service may become much more prevalent, Sloan believes. For now it makes particularly good sense for very small businesses, but he sees a trend toward what he calls virtualization that may make such services attractive to companies of just about any size. 

“As virtualization becomes more commonplace both on the side of storage and [computer] processing, I think we will see the IT-less IT dept become feasible,” he said. “So as these services become more mature and as people get more comfortable with the idea, I can see them potentially moving up the food chain.”

While all the services we looked at tout their ease of use and security – data is encrypted during upload to the server or download back to a user’s computer – each offers a slightly different value proposition.


HP’s Upline, the price leader, offers plans for individual home or home office users, and multi-license plans for families and small businesses. They all provide unlimited storage capacity and the same set of services: automated online backup, sharing of files with individuals or groups and publishing files to the Web.

The lowest-price, single-license plan provides unlimited storage for five dollars a month – that’s a pretty good deal. The professional version, which includes three licenses, expandable to 100, costs about $300 a year.

The backup service is generally good, with one significant flaw – Upline won’t back up Microsoft Outlook PST (database) files.

You start by telling it which folders to back up and indicating which types of files you want to include or exclude. After it has completed a first backup, Upline watches the folders you’ve selected and uploads any file that changes. You can set it to backup at intervals starting from as little as 15 minutes.

The sharing features are rudimentary compared to some other services. You can e-mail a link to people that allows them to download a file. If you change that file, Upline automatically e-mails previous recipients a link to the new version.


Box.net does not offer online backup and storage capacity is limited – to five gigabytes for $15 a month – but it does provide true sharing and collaborative features.

You can assign collaborators permission to make changes to files in a shared folder. The system provides detailed reporting and e-mail alerts on any changes made. And it automatically retains and manages previous versions. You can specify a fixed number of previous versions to keep or the  length of time Box.net should retain previous versions.

The new Box.net Enterprise plan, designed for companies with three or more people, includes a console that lets an administrator manage individual accounts and permissions and place limits on storage capacity. The company also offers service level agreements (SLAs) that guarantee availability and safe retention of data.

“This is a very aggressive SLA for enterprise customers that provides for financial reimbursement if there’s down time,” noted Jim Herbold, the company’s enterprise general manager.

One differentiator for Box.net is its OpenBox initiative. The company partners with providers of Web-based software services. Box.net users, either subscribers or invited collaborators, can use the services to view and edit files without having to download them first. Some of the services are fee-based, but some are free, including Picnik, an online photo editor, and Zoho, an Office-compatible online word processor. 


Egnyte may ultimately be the most attractive of the three we looked at. It offers the collaborative sharing features of Box.net – permissioning to allow chosen collaborators to modify files, automatic versioning and version management, and e-mailed alerts of changes – plus continuous automatic backup. And the storage capacity is unlimited.

Egnyte can work literally as a virtual server that looks, and acts, like a server on your local network. You can access it from either Windows or Macintosh desktops, and it shows up as a storage drive. The dual-platform support is another key benefit for small businesses, the company claims. Jain says 40 percent of his customers have at least some Macs.

The price is $15 for “power” users and nothing for “standard” users. Only power users can back up files and access the server from their desktops.

The Egnyte backup system doesn’t let you specify which types of files to include or exclude, although that feature will be added soon, the company promises. In the meantime, if you select your My Documents folder to back up, Egnyte will backup orphaned temporary files in the folder as well as the word processing, spreadsheet and PDF documents you really want.

It’s not a deal killer, and on the plus side, after the first backup, the Egnyte client software you download and install on your computer automatically backs up files continuously, as you make changes.

Due Diligence

As attractive as these services sound, Sloan urged caution. He’s not saying, don’t use them, just be careful. “You’re entrusting your data to a third party,” he pointed out. “So at a minimum you’re going to want to know what kind of security [the service provider] has in place.”

Other questions: Where and how is the data stored? Does the service provider have redundant servers so that if one fails, you can still get your data? What about the company itself? Is it a brand-new start-up – what’s its track record?

“You certainly don’t want to be in a position where the company disappears. And if that does happen, what kind of guarantees do you have that you can get at your data?”

That said, choosing a big, name-brand service provider is no guarantee of flawless service. HP’s Upline did go down earlier this year, leaving subscribers unable to access their data.

One other concern specific to online backup services: how quickly can you restore data in the event of a disaster? “If [the data] is business critical data and everything comes to a halt [until you retrieve it], how will that fit with your downtime tolerance,” Sloan wonderd?

Creating a virtual enterprise with no IT infrastructure, or virtually no IT infrastructure, is more and more a feasible proposition. Services such as HP Upline, Egnyte and Box.net provide convenience, security and ease of use for small businesses that need to secure data and make it available to collaborators.

It just takes a little getting used to, the idea that somebody at the other end of a high-speed Internet connection has access to and is responsible for preserving your precious data.

Based in London, Canada, Gerry Blackwell has been writing about information technology and telecommunications for a variety of print and online publications since the 1980s.

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This article was originally published on Thursday Jun 19th 2008
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