It’s unclear how much damage Hurricane Irene will deal out as it travels up the Eastern Seaboard this weekend, but in the British Virgin Islands, it’s already caused one notable loss. Lightning from the storm sparked a fire that destroyed the home of Sir Richard Branson, who lost thousands of irreplaceable photographs in the blaze.

That’s the strongest case I can think of for storing all of your photos in the cloud. (It sounds like Branson’s photos were prints, but he probably could have afforded to get them scanned.) There are other big reasons too—once a photo is online, it’s obviously much easier to order prints or share it with friends or family. But the cloud’s power as a giant backup drive is probably its best selling point. After all, photos are the next best thing to memories, and if you lose your memories, you lose a part of yourself.

The question, these days, is which cloud photo service to use. I’ve been a Flickr member virtually since the service’s founding in 2004, when it was still owned by Vancouver, BC-based Ludicorp. I have nearly 13,000 photos and videos stored there, and they’ve racked up some 168,000 page views over the years. But I’m very concerned about Flickr’s future within Yahoo. Its founders Stewart Butterfield and Caterina Fake are long gone, longtime product head Matthew Rothenberg (a veteran of the Butterfield days) departed in March, and it doesn’t appear that the 46-member Flickr team is being given much room to innovate these days.

Flickr did roll out a nice redesign last summer, but such updates seem to take years, while features that are in dire need of improvement, such as the apps that let you upload photos from your Mac or Windows machine, go completely neglected. Flickr has been outmatched by Facebook when it comes to social photo sharing; it hasn’t put out an iPad app; and it completely missed the boom in photo sharing on camera phones, leaving it to startups like Path, Instagram, PicPlz, and Color. (One former Flickr architect wrote on Quora that Yahoo wasted years in the early iPhone days on internal debates over the implications of the mobile revolution for photo sharing.)

I’m not saying that Flickr is dead or even dying—it’s just not clear that Yahoo understands or values the service anymore. In a December 2010 layoff notice explaining that Yahoo was “cutting investment in underperforming and non-core products so we can focus on our strengths,” Yahoo CEO Carol Bartz pointed to e-mail, the Yahoo homepage, search, mobile, advertising, and content as strengths, but she didn’t mention photos.

You might ask why I’m focusing on Flickr as the incumbent, when the biggest photo sharing service in the world, by far, is Facebook (it stores about 100 billion photos, compared to Flickr’s 6 billion). Well, here’s why: Facebook doesn’t actually care about photos. It only cares about the people who appear in them. If it were concerned about the images themselves, it would offer better tools for creating, curating, and viewing photo albums; instead, it’s poured most of its photo-related development efforts into tools for tagging the people who show up in photos. That’s key because tagged photos show up in the news feeds of the tagged individuals, which helps to keep the whole endless conversation that is Facebook rolling. The images themselves might as well be piled up in a giant shoebox, for all the effort the company puts into helping you organize or discover them.

So what’s left, if you’re looking for a serious cloud photo service beyond Flickr? As it happens, there are some very interesting new options. I want to touch on three of them today: Google+, Apple’s iCloud, and a brand-new service called Snapjoy. They each push in a different direction—you might call them Web-centric, device-centric, and cloud-centric, respectively. I have no idea which one will prove most popular. But at least we’re living in interesting times. It almost feels like 2004-2005 again, when Flickr itself was new.

Google+

Back in 2004, Google bought a Pasadena, CA, startup called Picasa and started giving away the desktop photo editing software it had developed. A couple of years later, in 2006, it bolted on Picasa Web Albums, which allowed Picasa users to … Next Page »

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San Jose, CA-based Nimble Storage, which makes flash- and disk-based backup and storage devices for enterprises, said today that it has closed a $25 million Series D financing round. New investor Artis Capital Management led the round, which was joined by existing investors Accel Partners, Lightspeed Venture Partners, and Sequoia Capital. The company, which has raised $58 million all told, said it will use the cash to expand international sales efforts.

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It’s not just the tech behemoths who are girding for the patent wars. Dashwire, a Seattle cloud-services startup, today announced a licensing deal with Intellectual Ventures, Nathan Myhrvold’s Bellevue, WA-based patent middleman firm. Terms were not disclosed.

Dashwire’s products synchronize and back up data from smartphones and other mobile devices to the Web. The company has been around since 2006 and has about two dozen employees, CEO and founder Ford Davidson says.

So why would a little mobile-service startup need access to a heavyweight patent portfolio like the one held by Intellectual Ventures? Because Dashwire is being sued in federal court by Synchronoss (NASDAQ: SNCR), a New Jersey-based company with a billion-dollar-plus market capitalization that provides some similar services.

Of particular concern to Synchronoss in the lawsuit was m:IQ, a data backup service offered by electronics retailer Best Buy that is based on Dashwire’s technology. Dashwire is opposing the patent lawsuit, in part on a claim that m:IQ is not its product, but Best Buy’s.

But it now has a new weapon to defend itself: intellectual property licensed from Intellectual Ventures, which claims an overall stockpile of more than 30,000 patents. The two companies didn’t identify the specific patents being licensed, but Dashwire plans to use them in the Synchronoss lawsuit. “The landscape is littered with litigation. It’s like a battlefield in the smartphone space,” Davidson says.

Just this week, Google jumped into that battlefield by placing a $900 million bid for patents from bankrupt telecommunications company Nortel. With its Android mobile operating system making huge gains in market share, vice president and counsel Kent Walker wrote that Google now finds itself needing more intellectual property to defend against lawsuits.

“We’re doing it for the same exact reasons. We’re just not quite as big as Google,” Davidson says. “But we at least found a big dog to help us.”

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Backupify, a Cambridge, MA-based provider of online technology for backing up e-mail and social networking data, announced today that it has acquired TweetBackup, a Sweden-based service that automatically backs up users’ Twitter posts daily. Financial terms weren’t disclosed for the deal, which went through in October and is meant to help Backupify maintain its edge in the cloud-based data backup and management arena.

It’s another move into a major social media platform for Backupify, which operates out of the same building as Xconomy headquarters. Last week the firm announced it released a backup and archiving service for Facebook Fan Pages, geared toward businesses that need to track their activity on the social networking site. Backupify has offered a Twitter archiving service before, but says that the TweetBackup acquisition brings its total user base to more than 100,000. TweetBackup, which archives Twitter lists, messages, and photos, will continue to operate as a standalone product, and its users will gain access to Backupify’s customer service team, according to today’s announcement.

Backupify, which moved to the Boston area from Louisville, KY, this past spring, started in 2008 as a free service geared toward consumers, but has shifted to include companies in its customer base. In the summer it announced a new service for backing up data found in Google Apps like Gmail, Docs, and Calendar, targeted toward small- and medium-sized businesses.

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Mountain View, CA-based Axcient, which provides backup and disaster recovery services to managed service providers serving small and medium sized businesses, has collected $9 million out of a potential $10 million in equity-based Series B funding, according to a July 14 regulatory filing. The funders were undisclosed. Axcient last raised $6 million in a May 2009 Series A round with Thomvest Ventures, Allegis Capital, and Peninsula Equity Partners participating.

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[Updated 5:00 p.m. 1/7/10 with information about the investors in the round] Boston-based Carbonite, which shares the market for online PC backup services with EMC’s Mozy, has raised an additional $20 million round of funding, according to a regulatory filing today. New investor Crosslink Capital of San Francisco led the round, and all of the company’s prior investors also participated, says David Friend, Carbonite’s founder and CEO. “This is a mezzanine round which we anticipate will accelerate our growth going into an IPO a year or so out,” Friend tells Xconomy. The company has previously raised about $47 million, including, most recently, a $20 million Series C round in September 2008 that included Menlo Ventures, 3i Group, Performance Equity, and CommonAngels.

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Framingham, MA-based GlassHouse Technologies, which provides data center management and backup services, has raised $2 million in new equity financing, according to a regulatory filing. The company declined to comment on the funding. GlassHouse’s previous financing round was a $9.8 million Series F investment one year ago led by Cisco Systems. The company nixed plans for an initial public offering in March 2009.

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It was a pretty quiet week for deals in the Northwest, what with the Thanksgiving holiday. But there was some activity in the software, Internet, and medical device sectors.

—Paul Allen’s Vulcan Capital participated in a $6 million equity funding round for San Francisco-based Bizo, an online ad network and audience targeting platform. Bessemer Venture Partners led the round, and Venrock and Ascent also participated. Bizo spun out of ZoomInfo last year, and is one of seven finalists in the 2009 Amazon Web Services Start-Up Challenge; the winner will be announced on December 9.

—Bellevue, WA-based Ignition Partners participated in a $1.1 million equity financing for French photo encyclopedia startup Fotonauts, as Ryan reported. Banexi Ventures Partners and Fotonauts co-founder and former Apple executive Jean-Marie Hullot also invested in the round.

—Seattle-based EVO Media, the creator of DevHub, a Web publishing platform, raised $1.5 million in equity financing from angel investors including Jeff Schrock, Geoff Entress, John Cunningham, Alex Algard, and Richard Wolpert, as well as an undisclosed private equity group. EVO Media, which has been profitable since last summer, will use the money to work with larger publishers, support new partnerships, and do more marketing.

—Datacastle, the Seattle-based data backup and recovery software company, raised a $3 million funding round led by Australian venture firm CM Capital Investments, an existing investor. Datacastle was founded in 2005 and raised a $5.3 million Series A round, also led by CM Capital, last year.

—EndoGastric Solutions, a Redwood City, CA-based medical device company with operations in Redmond, WA, said it closed on a $21.5 million Series E round of financing. The company makes minimally-invasive surgical devices for chronic heartburn and other gastrointestinal diseases. EndoGastric previously raised around $82 million, from firms like Advanced Technology Ventures, Chicago Growth Partners, DeNovo Ventures, Foundation Medical Partners, MPM Capital, and Oakwood Medical Investors, according to PE Hub.

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Now I know why venture capitalists walk the halls at the University of Washington—you never know who you might run into. My timing was impeccable yesterday as I sat down with Kai Li, the co-founder and chief scientist of Data Domain (NASDAQ: DDUP), the Santa Clara, CA-based data storage company that just got bought by EMC (NYSE: EMC) for $2.1 billion in cash.

Li, who is a computer science professor at Princeton University (he has been visiting the UW for the past year and has some strong Seattle connections), made time for me despite his busy schedule. The deal with EMC has been in the works since June 1, when the Hopkinton, MA-based data storage and management giant launched its bid to acquire Data Domain despite a pending acquisition attempt by rival NetApp (NASDAQ: NTAP) initiated in May. Many twists and turns ensued, culminating in yesterday’s announcement by NetApp that it had taken itself out of the running, clearing the way for EMC’s takeover, at a bid of $33.50 per share.

Data Domain’s story is a compelling one. Li co-founded the company in 2001, together with Brian Biles (currently vice president of product management) and Ben Zhu (former chief research officer), with the idea of developing advanced “deduplication” software to get rid of redundant data before it gets stored, thereby saving companies storage space, time, and money. Li served as chief technology officer and CEO in the early days of the company, but since 2002 has been a consulting chief scientist and director. Over the next few years, Data Domain gained traction in the data backup and disaster recovery market and went public in June 2007, raising more than $110 million in an IPO.

In a wide-ranging interview, Li (left) talked about Data Domain’s technical approach, its market strategy, a little bit about the EMC deal, and the broader future of data storage. Here is an edited account:

Xconomy: So how does the EMC acquisition affect you?

Kai Li: I don’t know yet. EMC has been the leader in storage systems in general. They’re bigger than other players in the storage market, comparing with NetApp, IBM, HP, Dell, and Sun (now part of Oracle). EMC is the premier storage vendor for data centers. We haven’t been communicating with EMC because of the definitive agreement with NetApp, so I haven’t talked to EMC yet.

X: How does the deal affect Data Domain’s operations?

KL: EMC has written a letter to Data Domain employees. They said they’ll keep Data Domain … Next Page »

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Boston-based online computer backup provider Carbonite announced an agreement yesterday with Sun Microsystems that could broaden the startup’s user base. Computer users who download Sun’s Java runtime environment for the first time, or who upgrade to the newest version of Java, will be offered a 30-day free trial of the Carbonite service. “This program will increase awareness of the importance of data backup among the millions of loyal Java users,” Carbonite president and COO Keith Cooper said in a statement.

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In case you missed it over the holiday, an electrical fire and power outage at Fisher Plaza near Seattle Center late on Thursday night disrupted a number of websites and services, including those of local tech companies Redfin, Survey Analytics, and Big Fish Games, as well as Microsoft’s Bing Travel site (formerly Farecast), Verizon’s DSL service in the Seattle area, and local television and radio stations including KOMO.

There were no injuries, and most operations were back to normal by the weekend, though Bing Travel was down until late Saturday morning. The news was reported by local and national outlets, including TechFlash, The Seattle Times, The Seattle P-I, and CNET.

Internet companies were directly affected as far away as Marlborough, MA-based Authorize.net (now owned by CyberSource), a credit-card service for online merchants that uses a data center at Fisher Plaza. And there was a ripple effect from there. Annette Tonti, the CEO of Rhode Island-based MoFuse, a network of build-it-yourself mobile sites, says her company’s service was disrupted on Friday because it uses Authorize.net to process credit cards. “The issue for us was getting customers signed up,” Tonti says. “However, we were not affected too long and everything appeared to be working fine by later in the day.”

“Companies should have servers at various physical locations, spread far apart, to keep isolated incidents like a fire from taking down a service,” says David Berube, MoFuse’s founder and chief architect. “I’m sure Authorize.net does have a redundant system, and their quick response to get service back up shows to me that they do have some sort of redundancies in place.”

Closer to home, there has been quite a lot of discussion about what went wrong, and how companies can better prepare for such outages, which seem rather inevitable. The cause of this particular fire is still under investigation.

Praerit Garg, co-founder of Symform, a data storage startup in Seattle, agrees it’s important … Next Page »

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It’s a rare event for EMC, the Hopkinton, MA-based storage and information management giant that has been on an acquisition spree over the last few years, to launch a new product line in-house. But that’s what’s happening this week as EMC rolls out “SourceOne,” a new family of software products designed to help companies prepare for, and minimize the costs of, legal cases that may require them to produce corporate documents such as e-mails.

When companies get hauled into court, new federal rules put into place in 2006 mean they have to be ready to hand over stored e-mail and instant messages as part of the discovery process. If they haven’t been archiving this information systematically before a discovery request hits, it can be extremely costly to comply fast enough to meet court deadlines. Market research firm Gartner reported last year that paying lawyers to sift through e-mail files for relevant messages costs an average of $18,750 per gigabyte.

SourceOne is designed to drastically reduce those costs. It consists, at launch, of two components. The first is an e-mail management program that works with corporate e-mail server systems such as Microsoft Exchange and IBM Lotus Notes/Domino to create a definitive archive of e-mails and instant messages. The system not only makes sure that all of a company’s e-mails are in one searchable location, but decreases storage needs by getting rid of duplicate data. The SourceOne e-mail management product is designed as a next-generation replacement for EMC’s EmailXtender product, which EMC inherited when it acquired Legato Systems in 2003, according to Kelly Ferguson, a senior product marketing manager at EMC.

The second component is the SourceOne Discovery Manager, which is specialized for searching large volumes of e-mail and isolating the subset of documents that must be handed over to outside counsel in legal cases. “A company might have a million messages that fit the date range or subject” for a given case, says Ferguson. “Discovery Manager will narrow that down so that only what is relevant is held in a secure ‘legal hold’ folder.” The system complies with the Electronic Discovery Reference Model (EDRM), a set of e-discovery guidelines set up several years ago by a group of roughly 100 software vendors and consulting firms, including EMC.

Later this quarter, EMC plans to add a third component to the SourceOne family, the Discovery Collector, which will quickly scour a company’s larger information … Next Page »

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Boston-based online storage provider Carbonite said yesterday it plans to increase the cost of its service from $49.95 per year to $54.95, effective March 16. But customers will get added features for the extra money—notably the ability to access the files they’ve back up from any compute via a Web browser. “Remote access is a feature our users have been eager for us to include because it gives them the freedom to access their backed-up files even when they’re not at home,” David Friend, Carbonite’s CEO, said in a statement.

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If you ate on your best china every night, flew first class even on puddle jumpers, and habitually drove your Mercedes rather than your minivan to the grocery store, it would be a lot like what most big companies do with their data, according to Tom Cook.

More and more of the information that e-commerce companies and other data-intensive businesses collect sits on expensive “primary storage” devices from companies like EMC, Hitachi, and Hewlett-Packard. Those machines make the data immediately accessible to the company’s Web-based applications or enterprise management software. But on average, only about 25 percent of the data in primary storage is actually needed for day-to-day transactions, says Cook, CEO of Cambridge, MA-based Permabit Technology. “If you moved the other 75 percent to a lower-cost tier, you’d get much better efficiency and better cost savings,” he says.

Permabit, you may not be surprised to hear, offers just such a technology: what it calls “enterprise archive storage.” Enterprise archiving isn’t the same as the daily data backups that most companies generate. Those systems, which are often tape-based, are still needed to guarantee that companies can recover from disasters. The difference is that most companies never plan on using the data that goes into their backup systems, whereas Permabit’s systems are built to store the final copies of frequently used files—just at lower cost than primary storage.

Most companies pay $30 to $50 per gigabyte for primary storage, according to Cook, while Permabit’s systems list for $3.50 per gigabyte. If customers use compression and de-duplication (the weeding out of redundant data) to squeeze even more information onto Permabit’s hard drive arrays, they can get that cost below $1 per gigabyte, he says.

There’s a technical secret to how Permabit can store all this data cheaply and reliably, in a way that frees customers from having to “migrate” from one generation of storage technology to the next every few years. And there’s a business secret to how the company—which was founded in 2000 but has only begun to see serious market demand for its technology in the last couple of years, according to Cook—has stayed alive so long without an “exit” event for its investors.

The technical secret first. If you’ve ever wandered into a data center, you’ve probably heard of RAID—an acronym for “redundant array of inexpensive [or independent] disks.” This became the dominant technology in the 1990s for splitting up data across lots of PC-class hard drives (as opposed to the huge, expensive drives on 1980s mainframes). RAID is great for storing terabytes of data cheaply, and it’s somewhat fault-tolerant: if one drive fails, it’s usually okay, because the data is copied and stored on at least one other drive.

But RAID has a weakness. If one drive fails and a new one is installed in its place, the data that was on the failed drive has to be replicated by locating it and reading it off remaining drives in the array. If an error occurs during that process—if, say, a storage block becomes corrupted and unreadable—there’s a small but real chance that the original data will be lost forever. And if a second drive fails before the reconstruction is complete—well, let’s just say you’re hosed. (In the case of a 16-drive RAID 6 array with two failed drives, Permabit calculates that there’s a whopping 50 percent chance that reconstruction will fail.)

To guard against that problem, Permabit’s founder and chief technology officer, Jered Floyd, led the development of an alternative storage approach called RAIN-EC. That stands for “redundant array of independent nodes—erasure coding.” The erasure coding is the key part; it describes how Permabit’s drives slice up data during the de-duplication process to make it “erasure resilient.”

The geeky details: For any given chunk of data, RAIN-EC first splits the chunk into four “shards.” It then uses a special algorithm to whip up two additional “protection” shards containing bits and pieces of the first four shards, in such a way that reading back any four of the six shards is enough to reconstruct the original chunk. Each of the six shards is then written to a different storage node in the array. (A node can consist of a single hard drive, or a cluster of them.)

In this way, very large files get spread across nearly the entire array. If any single node in the array fails, … Next Page »

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Boston-based Carbonite, whose online backup service is the main competitor for Decho’s Mozy, has gotten some good publicity over the last few months for its tongue-in-cheek promotions on Jimmy Kimmel Live and other TV and radio programs. But the company is taking a public relations hit this week over a recently uncovered case of reviews planted on Amazon by Carbonite employees who didn’t identify themselves as such. The reviews were published three years ago—and it’s just one of many cases of people trying to game Amazon’s customer reviews—but they’ve attracted widespread publicity this week thanks to a blogger whose criticisms of Carbonite were highlighted Tuesday by New York Times technology reporter and columnist David Pogue.

I called Carbonite CEO David Friend yesterday to get his company’s side of the story. He didn’t try to spin or shift blame for the episode: He says it was “totally wrong” for Carbonite staffers Swami Kumaresan and Jonathan Freidin to post positive reviews of Carbonite’s service on Amazon without making it clear that they were Carbonite employees.

“We apologize for it,” says Friend, who also wrote to Pogue after Tuesday’s post, apologizing to Amazon visitors who may have been misled by the reviews. “We pulled the things down the day we found out about them,” he says.

The Amazon case was an isolated incident, Friend says. “Some people are alleging that this is a pattern of behavior,” Friend says. “It isn’t. It was just one thing that happened back when Carbonite had eight employees and there were a bunch of young guys who didn’t know any better…This was just two overenthusiastic employees who decided to post these things on their own. To be honest they thought it was cool.”

Since January of 2007, he says, Carbonite has had a policy requiring anyone affiliated with the company to disclose that relationship whenever they contribute to blogs or review sites. He says there will be no disciplinary action against Kumaresan or Freidin, since they published the reviews before the policy was put in place. “I’m not going to punish somebody for something they did three years ago,” he says. “Everyone has been well aware of the policy since it was put in place. Had anyone violated the policy since 2007, they would have been in trouble, but there have been no infractions since then.”

But while Friend is apologetic, he’s also a bit miffed about Carbonite’s treatment in the blogosphere over the past couple of days.

The controversy got rolling on Sunday when a blogger and former Carbonite customer using the pseudonym “Bruce Goldensteinberg” published a long post describing his frustrations obtaining technical support from the company. Goldensteinberg wrote that in early 2008, after experiencing a computer crash and then running into problems restoring his data from Carbonite’s backup version, he spent “literally hours on the phone” with customer service representatives and a member of Carbonite’s sales department. (He had opted not to pay Carbonite’s $19.95 fee for priority support—i.e., immediate access to telephone representatives.) Eventually, he was able to restore some of his data, and “after much complaining” he was offered a refund worth a year’s subscription, which he accepted.

In a search later to see whether other people had experienced similar frustrations, Goldensteinberg writes, he found the Amazon reviews by Kumaresan and Freidin. He became suspicious about the sources of the reviews, and discovered through more searches that both men work at Carbonite. The remainder of his post details his detective work and criticizes Carbonite’s actions as “dishonorable,” “unscrupulous,” and “brazen.”

Quite apart from the matter of the Amazon reviews—the impropriety of which Friend does not dispute—I wanted to know whether Friend thought Goldensteinberg had a legitimate beef with Carbonite’s custom service department.

He did not think so. “It says right on our website that we do not provide free telephone support,” Friend says. “If you want to talk to Carbonite for free, you can use text chat or e-mail. This guy called up and was told that the premium telephone service is $20—which is a lot cheaper than [telephone service at] Dell or Microsoft.” The conversation between Goldensteinberg and Carbonite’s representatives became heated, Friend says. “We finally ended up giving him an hour of help. And there was nothing wrong with Carbonite—all of the things were his issues. He has just never gotten over that.”

I e-mailed Goldensteinberg Wednesday afternoon asking for a response to Friend’s comment. Goldensteinberg wrote back: “Was the customer service experience with Carbonite great? Not at all. It was terrible. But I wouldn’t have gone to David Pogue, and he surely wouldn’t have written about this issue if the only thing I had to write about was bad customer service. Honestly, I only included the part in my review about the lousy customer service as a background to how I discovered the fake reviews on Amazon. Any attempt to divert attention from the main issue here…is a red herring.”

Indeed, the whole matter might have ended with Goldensteinberg’s post, if the blogger hadn’t contacted Pogue. The famed columnist wrote in his own blog “Pogue’s Posts” on Tuesday that … Next Page »

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If you’ve ever had to replace your home computer, you know what a hassle it can be to copy your most important software and data from the old computer’s hard drive to the new one. The IT-industry term for this process is “data migration”—and it’s even more of a headache for system administrators at big companies than it is for average PC owners. But AutoVirt, a Nashua, NH, startup that’s expected to come out of stealth mode next week, has a solution for the problem—at least for companies that use Windows-based computer networks.

In a nutshell, the company’s technology uses a form of virtualization to trick an organization’s client computers into thinking that they are communicating with the same old storage system, even if it’s brand new. Investors seem to think the idea is a good one: AutoVirt will also announce next week that it has collected $4.5 million in Series A funding from Boston and Menlo Park, CA-based Sigma Partners and Waltham, MA-based Kepha Partners. [[Editor's note: Turns out this is the same money the company announced back in January as a $4 million Series A round, plus a $500,000 seed round.]] AutoVirt CEO Klavs Landberg, a veteran of Sun Microsystems and Data General, says he sees an opportunity for his company to outmaneuver Microsoft, which he says created the data migration problem in the first place by setting up such a convoluted system for naming the various devices on a network.

The problem, as Landberg describes it, is that when a company buys the equivalent of a new hard drive for its office network (they’re usually called “network-attached storage” or NAS devices), putting it into production is far more than just a matter of replicating the old data Every machine that communicates with the device must be reprogrammed with its new address and with the locations of the exact “shares” or sections of that device’s drives where it’s allowed to store data. It’s an exhausting, error-prone, entirely manual process,  Landberg says.

Weekend migration projects often spill over into the work week, causing disruptive downtime. In fact, IT administrators so despise data migration that they often overspend on storage devices that are bigger than they really need so that they never have to move anything. “Because data migration is too hard and too risky, they end up with 25 percent utilization of their NAS devices,” Landberg says. “The problem is getting worse and worse. But we are going to make it go away in its entirety.”

AutoVirt’s software is designed to be installed on a network at the same time that an organization is adding a new storage device. It functions as a virtual replica of the old device, intercepting data addressed to the old drives and sending it to the appropriate shares on the new device. It’s as if you submitted a change-of-address form to the post office, and they agreed to forward all of your mail forever; that way, you’d never have to let your friends and family know about your new address.

It sounds simple enough—but it will save so much labor that IT departments will gladly fork over $25,000 to $50,000 per installation, according to AutoVirt’s surveys of prospective customers. Landberg says that’s within the price range of the thousands of medium-sized businesses that added NAS devices to their networks over the last decade without much thought to how they’d upgrade. “Everybody, without much foresight or planning, has started buying NAS devices, which are easy to use as long as you only buy one or two,” says Landberg. “But as soon as you buy more than that, and as soon as they start getting old, it gets hard. We are the only solution built specifically for the mid-market, the part of the market that has been ignored by the industry.”

AutoVirt’s software isn’t quite ready for mass distribution: Landberg says the company will start out with an “early adopter program” in which a handful of customers will be asked to validate the system’s effectiveness in real-world environments. General availability will come sometime next year.

If Microsoft is to blame for data-migration woes, I asked Landberg what’s stopping the software giant from stepping in to solve the problem—perhaps crushing AutoVirt in the process. “All of my investors ask that question,” he said. “The answer is that, of course, over time, Microsoft can do any dang thing they want—they have and they will.”

But in the area of virtualization, Landberg believes, Microsoft is “totally focused on putting VMware out of its misery. They are putting their entire virtualization budget into reclaiming lost ground in server virtualization, and taking back control of that technology. From my perspective, that leaves them no attention span to pay attention to us.”

Even if Microsoft decided to address the data migration problem today, Landberg says, “It would take them two years to put a program together—such is the decision-making process inside Microsoft post-Bill Gates.” And AutoVirt plans to achieve a commanding lead before then—big enough that Microsoft might decide to negotiate rather than fight. “By the time Microsoft comes back from the VMware wars,” predicts Landberg, “they will discover that AutoVirt has invaded their space and taken the position they should have—which will lead to a very interesting set of discussions and possibilities.”

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Back in May I wrote about the release of MozyHome for Mac, an Apple-compatible version of the Mozy online backup service that Berkeley Data Systems launched for Windows users in 2006. Between them, Mozy (which became part of Hopkinton, MA-based EMC last fall) and Boston-based Carbonite dominate the market for online backup—but for the moment, only Mozy’s system works with Macintosh computers, and the service has been so popular among Mac users that many Mac-based businesses have been using it, even though the MozyHome license agreement technically bars users from using it to back up business-related files.

Mozy COO Vance Checketts told me last spring that the company preferred to look the other way rather than turn business users away. But now that issue is moot: today Mozy will launch a public beta version of MozyPro for Mac, a business version of the backup service to parallel the original Windows version.

Like the home version, MozyPro for Mac copies sensitive data from the hard drives of Internet-connected computers to servers at Mozy’s remote data centers. But unlike the home version, it provides a Web-based administrative interface that allows IT managers to specify which content on each company computer should be backed up, and it can be used to back up servers as well as personal computers.

“There aren’t any other Mac backup solutions for businesses that come with an administrative interface,” Mozy spokesman Devin Knighton told me last week. “You can use Time Machine”—software introduced by Apple last year to allow Mac users to restore their computers to an earlier state—”but that only works for one or two people at a time.”

While individuals use online backup to protect against the computer theft or hard-drive crashes, businesses have even stronger reasons to subscribe to off-site backup services, Knighton argued, citing a study by the National Archives and Records Administration in Washington finding that 93 percent of companies that lose their data for 10 days or more file for bankruptcy within one year.

MozyPro’s pricing scheme works somewhat differently from the home service, which costs $4.95 per month for unlimited storage. The business version costs $3.95 per desktop or laptop per month plus $0.50 per gigabyte stored per month.

Carbonite, by contrast, charges a flat $49.95 per year for unlimited backups, and does not have separate home and business versions. Carbonite CEO David Friend says that a Mac version of Carbonite is in beta testing and is scheduled for general availability on December 15.

While Mozy’s Mac announcement is bound to get some media play this week, the EMC subsidiary may have a bit more catching up to do on the marketing side: Carbonite has been running an amusing promotion lately on “Jimmy Kimmel Live!,” the late-night ABC talk show (see the YouTube videos here and here).

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Automatic Internet-based backup services—the first form of “cloud computing” to hit the mainstream market—have been making news lately. Last Wednesday, the Mozy division of Hopkinton, MA-based EMC (NYSE: EMC) announced that its software will power an online backup service available to buyers of Thinkpad SL notebook computers, the newest line of business laptops from Lenovo. Not to be outdone, Boston-based Carbonite is expected to announce soon that it has formed an even broader partnership with the Chinese computer maker: All Lenovo IdeaPad and IdeaCentre computers—the company’s lines of home and home-office laptops and desktops, respectively—will now come with Carbonite’s online backup software pre-installed.

If IdeaPad and IdeaCentre owners give Carbonite an e-mail address and password, they’ll get 30 days of free backup service on Carbonite’s servers, after which they can elect to continue the service at $49.95 per year. The arrangement is a coup that could bring Carbonite tens of thousands of new users at a time when the competition for customers of online backup services is all about exposure, branding, and name recognition.

At the same time, Carbonite is about to announce formally that it has closed a $20 million financing round, the third since the company’s founding in 2005. (It raised $2.5 million in Series A funding in February, 2006, and completed a $15 million Series B round in May, 2007.) Carbonite co-founder and CEO David Friend, a veteran of the Boston technology scene with five previous startups to his name, calls the new financing round “a real achievement for the company,” given the general sense of caution prevailing in investment markets. All of the company’s existing investors—including Menlo Ventures, 3i Group, and CommonAngels—came back for the latest round, but it also included a new institutional investor, Performance Equity of Stamford, CT.

For the Series C round, “We were looking for somebody with their feet more in Wall Street than in Sand Hill Road, to show that we have a working business model,” Friend says. “This is no longer venture capital that we’re raising—it’s expansion capital, and the people who gave us term sheets did so because they looked at Carbonite and saw that we have a marketing engine where we can put a dollar in the top, turn the crank, and get four or five dollars out the bottom over the next two or three years.”

Whether online backup services really turn into that kind of money machine—and who ends up with the profits—will depend to a large extent on how quickly consumer awareness of the technology spreads and which company can get its name in front of computer users first.

Most computer users are aware of the possibility of losing the data on their local hard drives, whether through theft, hardware failure, or some other disaster. And most make at least desultory efforts to back up crucial business or personal data, often on DVD-RW discs or on a second, external hard drive. But relatively few people so far are aware of services like those from Carbonite and Mozy, which copy the data on PC hard drives to far-away data centers over broadband Internet connections. These backups occur automatically whenever there is new data to be duplicated. In the event that local data is lost, it can be restored by … Next Page »

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As Bob observed in a March story, EMC (NYSE: EMC), the Hopkinton, MA-based information infrastructure and content management firm, is very good at acquiring companies whose technologies fit with its existing technology architecture. But it isn’t so well known for actually melding the technologies from various acquisitions into new products. VMware (NYSE: VMW), for example, was acquired almost five years ago, in December 2003, but still functions as an almost completely separate company with its own line of software for virtualizing data centers.

Today, however, three EMC subsidiaries announced that they’re throwing their lots together—at least when it comes to data backup products for consumers and small businesses.

The three units are Walnut Creek, CA-based Dantz Development Corporation (acquired by EMC in 2004), makers of Retrospect backup software for Windows and Macintosh computers; Utah-based Mozy (acquired last September), which offers online backup services for consumers and businesses; and San Diego-based Iomega (acquired in April), which makes external hard drives. The organizations said that starting this summer, new portable and desktop hard drives from Iomega will come with instructions on how to download a free version of Retrospect Express that also helps buyers sign up for the free or premium versions of Mozy’s online service.

All of which means that PC users who buy Iomega external drives will be able to arrange cloud-based data backup at the same time that they’re setting up automatic local backups of their PCs’ primary hard drives. According to EMC, it’s the first time local and remote data backup have been integrated in a single product offering.

“It’s a seamless customer experience at this point,” says Steve Fairbanks, director of product management for Mozy. “When a customer goes to install Retrospect Express, they’re given the option to back up online using Mozy, and we’ve done the integration work to pass information from the Retrospect setup screens to Mozy.” That means, in effect, that PC owners can specify in one step which parts of their hard drives should be backed up regularly; the Retrospect and Mozy software will then make local and off-site copies automatically. Mozy provides up to 2 gigabytes of online storage free, and charges $4.95 per month for unlimited storage.

Fairbanks says the project to combine the Iomega, Retrospect, and Mozy products became a high priority for EMC as soon as the Iomega acquisition was completed. “This was a very strategic decision made by senior executives, involving working teams who identified great synergies between the products,” says Fairbanks. “If you think about it, the target audiences are very well aligned.”

EMC reasoned, in other words, that anyone who cares enough about their data to buy an external hard drive from Iomega is probably also cautious enough to spring for a second level of off-site protection from Mozy. “Mozy has about 750,000 customers, and many of them also have USB hard drives protecting their data—but they recognize that if their external hard drive failed or if, heaven forbid, their house or their business were to burn down or have some natural disaster, they would completely lose that data,” says Fairbanks. “The cost and efficiency [of online backup] has become such that customers are taking a look at both options now.”

Among the first products to include the new software bundle will be Iomega’s bestselling 500-gigabyte and 1-terabyte desktop hard drives, which are available from online retailers now and are expected to be on shelves at Best Buy before the end of July. The bundle will be rolled out with the full line of Iomega external hard drives over the next two months, according to EMC.

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Computer users are a seasoned breed, accustomed to less-than-perfect service from their machines. That applications suddenly freeze, forcing you to restart your PC every once in a while, is just a reality of modern life. But for a lot of businesses it’s vital to have a high reliability in their computing systems. If a banking systems goes down it can lead to big monetary losses; if a hospital system does the same the consequences can be even worse.

Stratus Technologies of Maynard, MA, has been in the business of building high-availability computer systems for decades—the company got started in 1980 as a maker of fault-tolerant minicomputers. It still sells its “ftServer” hardware, which come with their own special failsafe software, for customers who need very high quality of service.

On Tuesday, the company launched its first pure software product, called Avance. It transforms two ordinary servers, regardless of manufacturer, into a highly reliable computer system with more than 99.99 percent availability. “This allows our customers maximum flexibility,” August Calhoun, vice president for life sciences at Dell, said during a Stratus company webcast about today’s news.

The principle is that all active applications run on one server, which is continuously mirrored by the other one. If Stratus’s software detects a malfunction—say, a faulty hard drive–the other server node will take over the workload.

Avance is geared to small and medium-sized businesses. Stratus charges a one-time fee of $2,500 per server. As you need two servers for a meaningful installation, that means a minimum of $5,000 per customer.

“Stratus knows from three decades of first-hand knowledge that, all things being equal, every provider and user of computer-based services would opt for superior uptime reliability given the choice,” said Stratus president and CEO David Laurello in a statement about the product launch. “Avance software is the equalizer, eliminating the two biggest barriers—cost and complexity.”

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