Data storage: cloud vs hardware

Data Storage: Cloud vs. Hardware

July 14, 2015 Tech4BusinessNow Article

You need to back up your business data to a secure location, but should you use hardware or a cloud-based solution? We look at some pros and cons of each.

By Terri Coles

Cloud services for data back-up and storage are increasingly common and becoming more affordable. But how do you choose between a cloud-based solution versus a hardware storage device? There are pros and cons to each, depending on your budget, business needs, and work habits.

What’s clear is that it’s crucial to take steps to back-up your business data. “You never know when a hard drive will fail or a disaster of some kind will threaten your business data,” says Alyssa Gregory, a small-business expert and founder of Small Business Bonfire. “If a small- business owner loses data, it could mean the beginning of the end for the business.”

For example, a stolen laptop or damaged desktop hard drive could mean the compromise of sensitive financial information or the loss of contact information for customers and clients. Suddenly finding yourself without key business information could leave you unable to complete your day-to-day operations. Plus, exposing your customers to potential security issues could harm your reputation.

And it may not be enough to simply back up on an external hard drive kept in your office. “Keeping data backed up on your computer or on an in-house server is only the first step in data protection,” Gregory says. “The best course of action is a secondary backup that is off-site and highly secure.”

Hardware data storage: pros and cons

The best thing about hardware for data storage and back-up is that it’s within your control. “A physical server or external drive that you keep in-house can typically protect your data from hacking and loss of privacy,” Gregory said.

For example, you don’t have to worry about hackers the way you might with a cloud storage solution. You decide where your server or drive is located and, therefore, who can access it. You can physically see where your data is stored.

However, this means your storage hardware is vulnerable to anything that happens to the physical location where it is located. If there is a fire, natural disaster, or theft, your data could be lost—and if your originals and backups are in the same location, you may lose both.

Also, physical hardware can’t be accessed from another location. This could be an issue if you frequently work on the road or have employees who work remotely and need to access the data. And if you do configure the server or drive to be accessed remotely, there is a security risk related to opening up that connection, Gregory says.

“This method of backup can also be very costly, even more so if you have multiple computers to protect,” Gregory adds. While small external hard drives can be purchased inexpensively, physical hardware isn’t necessarily a cost-effective data-storage solution. You may need to purchase multiple drives or servers if you have to protect more than one computer or need them in more than one physical location. And you could find yourself quickly filling up your storage device if your store of data is particularly large.

Cloud storage: pros and cons

Ease of use is one of the main advantages of cloud solutions for data storage. Setting it up is often as simple as signing up for an account online and running through their back-up process, Gregory says. Back-ups usually can be automated so they are done regularly, and can be scheduled for a convenient time (overnight, for example). You also avoid the ongoing maintenance costs you face with hardware.

Cloud storage is also usually a cost-efficient solution for data storage, Gregory says. “Cloud storage requires much less of an investment than physical storage,” she says, particularly if your needs are small to begin with. Cloud storage plans can easily be scaled up or down as your needs change.

And if you are one of the increasing number of entrepreneurs who works remotely at least sometimes, having your data stored and backed up on the cloud means you can access it from anywhere with an Internet connection. It also makes it easy for you to share that data with employees and clients around the world.

But while most cloud services are quite secure, nothing is absolute. “While generally very secure and protected with at least 256-bit encryption,” Gregory says, “moving to the cloud makes the possibility of hacking greater since you do not solely control the storage.”

Talk to other entrepreneurs and businesses in your industry to find out what they’re using for cloud storage, and do some research to ensure the cloud provider you choose is taking appropriate security measures. Pick a reputable company with experience in the business.

Find out what type of technical support is offered by the cloud service, and ask about any possible restrictions on the size or type of files that can be uploaded. And keep in mind that you won’t be able to access your data in the case of a lost Internet connection or downtime on the service’s end.

If you currently use a hardware-based solution for data back-up and storage—or don’t have a solution of any kind in place yet—consider a cloud-based option, especially if set-up costs are a concern, Gregory says.

“Most small businesses can use the cloud in some capacity,” Gregory says. “The only businesses that may want to avoid the cloud are those with very sensitive client information, or those who store HIPPA data.”

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