According to a survey market research firm TheInfoPro, a mere 10 percent of large corporations are considering the public cloud as a place to store even their data -- even the lowest-tier info -- for archive purposes. I wasn't surprised to hear of these results.
Don't believe the survey? Look at recent news reports. Last year EMC announced it was shutting down its Atmos Online storage service because it was competing with its own resellers. Cloud storage provider Vaultscape also closed. Additionally, Iron Mountain said it had stopped accepting new customers for its Virtual File Store service and was doing a two-year glide to a complete shutdown. Finally, startup Cirtas Systems announced it was leaving the market to "regroup."
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Of course, there is Amazon's S3 service, which by all accounts is going like gangbusters. However, Amazon provides a more holistic offering; thus, much of the on-demand storage sold has been in support of data and application processing. I suspect Amazon made the market seem lucrative, and the ease of entry of creating storage on-demand storage was tempting for players that wanted to release a cloud offering on the cheap.
It seems clear the emerging market was not ready for so many players, and the lack of demand quickly shut some doors. I predict cloud storage will gain ground, but it will require players who are willing to invest the time needed for the market to emerge. However, VC-backed companies are notoriously impatient, and larger companies want quick ROI in the face of internal politics. Moreover, you're not only competing with other cloud storage providers, but with sharply falling prices for local storage.
The on-demand storage market will eventually evolve, and acceptance will take years, as we've seen with other emerging technologies in the past. In the meantime, we could look at cloud storage services to be the first real cloud failure. However, we learn from what did not work and plug on. Eventually, the market will be there.
This article, "Why cloud storage could be the first real cloud failure," originally appeared at InfoWorld.com. Read more of David Linthicum's Cloud Computing blog and track the latest developments in cloud computing at InfoWorld.com. For the latest business technology news, follow InfoWorld.com on Twitter.