Choosing your cloud storage service: deciphering the jargon

In the second part of this look at cloud storage, we look at various options available and how to choose

In my last piece on this topic,  I discussed my first cut needs analysis plus my initial trawl around the web to find more information on the service I have been contemplating.In this case I am talking about LiveDrive. In this piece I go further, explaining what you need to consider once you have settled on something that looks like it will pass muster.

In my last piece I concluded that while LiveDrive appears to tick my needs list, it doesn't look as though it makes the cut for Mac OSX devices, largely because of performance, bug and support issues. Since mine is a mixed environment, it's not enough that the service works well for Windows machines. I'll return to that. Now I want to talk more about business issues that impact my decision making process.

I've said this many times but it is well worth the repeating. A technical analysis of any service of itself is inadequate. You HAVE to look at business issues. This is particularly important when you are considering entrusting security needs to a third party. They go out of business and you're on the hook. They have a service issue - you're on the hook again. so when I am looking at this kind of thing, my next port of call is DueDil.

DueDil is short for 'due diligence' and it is one of the most useful services I have seen in many a day. They provide a snapshot of any company registered at Companies House that includes the latest financials and details of the people behind the company. And it is a free service. This is important stuff because it helps assess vendor viability and provides the basis for comparison against what the corporate website says. It also helps augment other information you might find on the Internet.

The accounts for the company - Fastdrive Internet Ltd - make difficult reading. It is technically insolvent to the tune of £3.4 million but when you read further in the accounts you find that its ultimate holding company is owed £1million and the CEO is owed £1.9 million.

That's a better picture than you might think. It does not look as though the company has taken direct inward investment. That's not a bad thing because companies that self fund are able to better control their destiny. The downside is that the owners can equally decide they've had enough and write off their investment. In this case, the company's owners appear to have taken most of the risks so will likely remain committed to growing the service. The problem is we can't see much more than I've already outlined. The company is not required to submit to an audit or disclose additional information and has taken advantage of those legal provisions.

That's a mistake because because the only other information we have to go on is its claim to provide white labelled services to PC World and CompUSA, its claim to have more than 500,000 customers and its claim to be number one in Europe and the US. The company also makes great play of its leadership, noting that:

Andrew Michael is one of the UK's most respected internet entrepreneurs. He previously founded the hosting company Fasthosts, and built it into the largest web host in the UK. Fasthosts was sold in 2006 to United Internet for over $120M, and Andrew founded Livedrive in the same year.

Impressed? If you're a fan of Dragon's Den then possibly so but that doesn't work for me and especially following what you can find in the published accounts. Now search Fasthosts on DueDil and what do you find? That company has had two complaints upheld against it by the ASA. In both cases, the complaints are noted after the CEO left Fasthosts. Should that matter in your assessment of this company? Yes and no.

There is no way to objectively test whether Fastdrive's positioning as number one is accurate or not but if it is then I'd like to know how that is defined. I know for example that DropBox is growing very quickly and that its revenue is of an order that would require full financial disclosure if they were based in the UK. Given that Fastdrive is not required to disclose you have to wonder what they mean. Similarly, the fact that a number of complainants talk about lack of support lends a lie to the company claims that 'all emails answered within 24 hours.'

Vendors get huffy when I make these statements but they forget that cloud offering success depends upon delivering top notch service. Fail one and a lot of others get to know about it. Even so, I am equally aware that there is always a group of people willing to vent. In the cases I have reviewed there appears to be some justification rather than them being random trolls. To its credit, Fastdrive has left all the comments in place rather than censor out. Where it really fails though is in not providing explanations or assurance about the issues reported by customers. That again would seem to knock a dent in its service claims.

Is that combination of facts and analysis enough to turn me off? Not quite. There is one more thing I needed to do. Check the pricing packages. My requirements list suggests that I should sign up for the highest priced package which works out at a tad under £100 a month or £1,000 a year. That is because the standard package doesn't give me quite enough and is a tad inflexible. I cannot for example add storage beyond 2TB, even though I know that data storage will grow and never shrink. That makes the service unattractive, even for the micro business.

If I am prepared to commit to a full year in advance without a trial then the price drops to £75/month. The savings are attractive as is the 30 day no quibble guarantee but the model is wrong. I could sign up for a trial and then simply drop it, then re-sign for a year in advance. What they should do is provide a no strings trial for the full service and then give the customer choice about how they wish to pay. That would give people like me the opportunity to reasonably test for myself and determine whether past gripes really are justified whether the service fits my needs. In other words it allows me to make a well informed choice on both the service and payment method. Despite all the reservations I've outlined, I'm prepared to give Livedrive the benefit of the doubt and see what happens. In the meantime here is my checklist of what you should consider when looking for cloud services.

  1. Make Google your friend.
  2. Comparison sites are useful as a guide but they are often stale. Ensure you widen your search.
  3. For this kind of service, make sure you have a well defined needs list and only select those services which meet all your 'must haves.'
  4. Read company blogs and any support or forum sites to test whether the claims a company makes are matched by what customers are saying. If there is a mismatch then test further to ensure you have a thorough understanding of where the service is winning and where it fails.
  5. Use DueDil to get behind the face of the company.
  6. Make sure you understand what the accounts of a company are saying. If you don't have the necessary skills then get your local friendly accountant to do this work for you but make sure they explain it in terms you can understand. Financial jargon has its place but not in a supplier assessment.
  7. Find out as much as you can about the people behind the service and don't simply accept the corporate marketing statements about past success. Winning once and cashing out big time in IT is often a matter of luck rather than skill. Doing it a second time requires a certain genius, That's why people like Marc Andreessen, founder of Netscape are well respected. They pick winners with boring regularity.
  8. Assess how well the business model is aligned to your needs. If it is inflexible then it might not meet your long term requirements.
  9. Even if you have doubts, consider testing the service. Nothing beats first hand experience. A 30-day trial should be enough provided you monitor the service.
  10. Be prepared to duck out of a trial or throw some money away. Experience now pays dividends later.

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