This company has been offering remote backup for so long, it claims it coined the term.

by Alex Goldman ISP-Planet Managing Editor [October 20, 2006]

Whenever you're looking at a value-added service provider, as an ISP, you look for two things first, before you look further. You look for a company that has worked with ISPs for some time, and you look for a company that won't go around you and sell direct to your customers.

Tommy Gardner, director of sales and marketing at Memphis-based Remote Backup Systems, Inc. (RBS), says the company he works for has all that, plus a long history of service. Founded in 1987, CEO and founder Rob Cosgrove built a remote backup system for Baptist Memorial Hospital. That evolved into the first commercially available remote backup system. "In fact, he coined the phrase," adds Gardner.

The hospital installation was used sooner than originally planned when lightning hit the server that was being backed up, says Gardner. Cosgrove realized that this was a real business, saw that problems occur regularly, and went into business.

Gardner says the company sticks to making a good product, and relies on channel partners to sell it. "We're software geeks, not service professionals."

The company, which has been around since the BBS days, understands the value of the channel. "We saw the cannibalization of Compaq. We saw what happened when Compaq established VAR channels and then turned its back on the VARs to go straight to the consumer. The VARs know what the market wants in terms of features. Our role is to provide software and support."

As a veteran, the company has had time to expand. Gardner says it is now in about 67 nations worldwide.

It works in so many places because, he says, remote backup is the ideal value-added service.

The economics
"Once the business process has been thought through, and a server is configured, distribution is a repeatable process," explains Gardner. "The software is fully automated and works at night. The service has low overhead and high recurring revenue. We do see companies trying to commoditize remote backup, but we find this great equalizer: the types of clients that ISPs want are not those interested in the least expensive solution. Business and consumer customers understand that the service level is an important part of the service, whether it's protecting a home user's photos or a business's Exchange database."

An example of poor service? "If you get a DVD of your data FedExed to you, and you cannot read the format, you're paralyzed."

The product
Remote Backup delivers a product that's designed for ISPs. A key feature is ease of installation. The software creates a single executable file that the user can download and click on to start the service.

The software supports reseller programs by tracking separate "account groups" for each customer, Gardner says. Each group can have its own, different .exe file.

The service keeps track of its progress with an Exception Reporter, that lets the user know if any files could not be backed up. Gardner says that open files cannot be backed up, so service providers need to remind consumers that only closed files will be saved.

Remote Backup understands that always on databases are a vital part of many small businesses, and has designed special modules to backup SQL and Exchange databases, allowing the customer to keep the databases running while the backup works in the background.

A recently built module, designed specifically for service providers, allows the product to deliver information to QuickBooks for recurring billing and invoicing.

Gardner says that a key differentiator is that users can choose their level of encryption, up to 448 bit Blowfish.

But to us, the most impressive differentiator is that the ISP can re-use all purchased licenses. "Even for the 5 client version, the service provider can re-use the license if, for example, a customer moves abroad. They can have the service auto-expire and reissue that client to another customer," explains Gardner.

The future
For the future, Gardner says the company is working on many new features:

• A replication server, that backs up all of the ISP's backup files (the functionality is there, but it's not productized yet, Gardner says)
• Real time backup across multiple platforms
• Do more with compliance, such as locking files for HIPAA or preventing deletion for Sarbanes-Oxley

Basically, Gardner explains, "backup is our core features, but because of our features and because of industry regulations, the natural next step is to add activity logging, the control of access to backup data, and to prevent illegal or unethical actions on the archives."

In addition, the company is adding languages as it moves into new markets around the world.

You can meet this company at ISPCON. "It's our fourth ISPCON. We always come away with a lot of interest, and it's a fun show to go to," says Gardner.

Pricing and availability
Pricing is published on the website, which is good, but the pricing scheme is not simple.

The company divides its wares into three categories: the core product, plug-ins, and marketing materials and assistance. In addition, there is an annual maintenance fee (one year of maintenance is included with most purchases, including the Pro Packs).

Most ISPs, we believe, will want to purchase the Pro Packs, which contain all the plug-ins. At press time, sample pricing was:

• 50 clients: $5,800 ($116 per client)
• 500 clients: $15,499 ($31 per client)
• 5,000 clients: $49,999 ($10 per client)

Volume discounting, as you can see, starts early and is very steep.

The marketing materials, which the company calls its "Business Kit", are sold separately. They include a sample contract for services with a good limitation of liability clause, says Gardner, in addition to marketing materials, a flash presentation, and even a site template. For some ISPs, this will be well worth it.

Annual maintenance fees vary by number of subscribers, again with deep volume discounts:

• 251 to 500 subscribers: $499 per year (about $1 per subscriber, at best)
• 1,001 to 5,000 subscribers: $1,999 per year (about $0.40 per subscriber, at best)

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