NEW ANALYSIS: Continuity needed
- 10 October, 2001 12:48
Disaster recovery has moved up the list of priorities on the Australian business agenda, but there are fears the channel has niched itself too far to be able to take advantage of the current market interest.
Industry pundits agree the recent increase in virus and hacking attacks, coupled with data-loss incidents reported in the wake of the September 11 terrorist attacks, have tipped the market focus towards business continuity.
Although the Australian market is not labouring under the same degree of fear as the US market, several disaster recovery and data-security companies have already reported a slight increase in interest for their wares. One of them, Melbourne-based Kanbay, has identified the current market climate as conducive to growth in the data-security, high-availability and digital-authentication markets.
"Events like those on September 11 tend to accelerate the thinking process in that businesses start to make assessments of the potential risks, and we're seeing that happen now," said Peter Spring, Kanbay's senior vice president for business development, Asia-Pacific. "This is an enormous point of opportunity for services organisations and consultancies to form partnerships and address the market from the policy level down."
Dr Kevin McIsaac, a former director of a backup and recovery software developer, and now program director at Meta Group Asia-Pacific, claimed the opportunity is for such companies to position themselves as one-stop shops for continuity solutions.
"It's hard to sell backup and recovery software because people are so busy with other [mission-critical] deployments," said McIsaac. "But for a third party to come in and do it all, [customers] are more willing to listen and pay a premium for it."
Despite it being a potential gold mine for consultancies, services companies and resellers of disaster-recovery software and monitoring tools, there are doubts the channel has the agility to capitalise on the opportunity.
"I don't know if the channel is swift enough on its feet to take advantage of this opportunity," said Simon Gatward, director of programs and marketing, Global Network Services at Unisys. "We know that our customers are looking for packaged solutions, not product. So they want the man in the van who will do everything, whereas channel companies are often not in a position to provide full service and a total solution to the customer."
As a result, Gatward believes even smaller organisations will look to top-end consulting organisations to provide them with a total business-recovery solution, with recognised brand names, outsourcing companies such as EDS and IBM GSA and even telecommunications companies likely to benefit the most.
"If there is one thing that the recent events have highlighted, it's the fact that you cannot consider disaster recovery, security and virus control as three separate projects, they are all inter-linked," Gatward said. "But most channel companies tend to focus on one of the three."
Graham Penn, IDC's director of storage research, suggested the channel should therefore try to become more adept at providing consulting services, starting with assisting businesses in the development of sound business-continuity policies.
"Fundamentally, there are not many organisations that get the idea of business continuity or have the resources to look at the problem internally," Penn explained. "Backup and recovery is just part of the problem and should not be looked at in isolation. They are related to data security and the need to develop data-security policies that are aligned with business objectives, but organisations either feel they don't have the skills or the necessary capital to do it."
However, in a market generally driven by ERP and CRM spending, this sudden interest in business recovery is seen as temporary.
Ultimately, extracting new business out of the currently reluctant market will be determined by the channel's ability to formulate policies and educate the market about potential risks, as most businesses remain oblivious to the dangers of business interruption.
"The analogy here is I don't have AIDS, so I don't need to wear a condom," quipped Unisys' Gatward. "All companies are connected in some way and it would be almost unethical to take that I'll be okay' attitude.
"The channel's job is to sell them services and make them understand that disaster recover, security and virus control are not a single-point exercise."