What Cloud Storages Changing Forecast Means For Your Data

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CIO Central Guest, Contributor

June 4, 2015

Cloud storage has revolutionized how we store our memories, how we collaborate on projects and even how we organize our lives. Many in the tech industry see the cloud as the definitive future of digital storage. But will the cloud of tomorrow look much like the cloud of today?

Last year introduced a lot of changes in the storage market, raising new questions and inciting new trends. What should consumers be aware of as they make decisions about how and where they store their data? Here are four storage stories likely to dominate the news over the next year and what consumers should do about them.

The Race To The Bottom

The ability to store unlimited files for free sounds like a dream, so it’s not surprising that companies continue to flirt with it. This race to the bottom accelerated with Google’s announcement last week of almost-unlimited photo and video backup via their Photos app (“almost” because they downsize your files unless you pay). While this may continue through this year and beyond, more companies will also begin to realize that cheap and unlimited storage is not a tenable business proposition.

We’ve seen this movie before. Startups like RapidShare, Bitcasa, and Megacloud had nearly free or nearly unlimited offerings that eventually failed. Bigger companies like Amazon or Google may find ways to subsidize free or unlimited offerings with the profits from other parts of their businesses for longer periods of time, but that’s a practice that can also quickly come to an end when regulators come sniffing – just ask Microsoft circa 1998-2001. Google is already facing anti-trust action in Europe.

The gambit to crush competition by offering free cloud storage is one that is risky – and not just for the company doing it. The consumers who trust these services should also be leery. Once a company has all your data, moving it somewhere else can be painful. The end game for these offerings is to eventually find ways to monetize your photos and videos .

Sure, some players in the market will continue to offer too-good-to-be-true prices and new startups promising the moon will emerge, but the writing is on the wall. I believe we will see the fallout from these unfeasible plans just like we have in the past.

If you pick a cloud storage service because it offers large amounts of space for little-to-no cost, realize the offer may not last. Have a backup plan and be prepared for costs to increase or to be forced to move your data sometime in the future.

To IPO Or Not To IPO?

There’s been a lot of buzz recently around Box’s decision to go public. Now there is expectation that other private players – like Dropbox – have active IPO plans. Successful companies like these are facing increasing pressure from players like Google, Microsoft, and Apple, who can afford to subsidize their cloud offerings with revenue from other parts of their businesses.

This continuing story will naturally bring up questions about whether cloud storage is a good investment for companies, but a more interesting question for consumers is what kind of company should they trust with their data. Does it matter that a company is public or private? Does size of the company, whether big or small, instill confidence in their storage product? I think these questions will be answered, and others will probably emerge, as more companies make IPO decisions this year.

The key is to keep an eye on what storage providers are up to and stay informed about the company you entrust your data to. If you feel uneasy about the direction they’re going, it may be time to make a change.

Boarding The Enterprise

While consumer cloud storage has been the main focus for many cloud storage companies, the allure of large margins for enterprise storage solutions are emerging as the more popular business model. How will this affect consumer offerings?

Enterprises have already begun moving toward using cloud storage tools to collaborate on documents, spreadsheets and other file types that don’t take up a lot of storage space. It simply does not cost very much to store those small files. Compare that to user-generated content comprised of large files like photos and videos and it’s easy to see why providers like Box and Dropbox devote more resources to their business offerings each year. Will this also mean that they devote less attention to lower-margin consumer offerings? The coming 18 months should tell us a lot about where these companies’ priorities are headed.

Businesses pay attention to what makes them money, and enterprise offerings often produce higher margins than those geared at consumers. Take notice of who your storage provider is marketing to and developing for. If it looks like it’s neglecting the consumer, it probably is, which can expose you to greater risk of security breaches, data loss and more.

Take Back Control

What is the cloud? Have you ever tried to explain it to someone? While cloud storage has become mainstream, 2014 saw a number of high-profile celebrities suffer embarrassing breaches that increased skepticism among consumers. Additionally, consumers are becoming more leery of who can see their data and how it is being used to track them by private industry as well as by governments. With all of this in mind, a backlash against cloud storage seems inevitable.

As consumer skepticism continues, companies need to create revolutionary solutions. Companies that want to succeed in the space and gain the trust of consumers will have to start innovating instead of merely updating. Uneasiness about the cloud will lead to increased comfort in the idea of storing data in the home where it can be more private and more secure and consumers will look for easy and affordable ways to do it, without sacrificing the benefits that the cloud provides.

In light of these trends, smart consumers will take responsibility for the protection of their data and know the risks that come with where and how they store it. Be an active participant in your data storage – be aware of what’s going on with the companies you entrust your information to and ensure you are taking full advantage of the benefits of cloud storage without walking into the pitfalls.

This article was written by CIO Central Guest from Forbes and was legally licensed through the NewsCred publisher network.


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