Disaster Recovery Outsourcing Rises with Cloud Services

January, 2013

After losing considerable ground during the recent recession, the percentage of companies that outsource at least some of their disaster recovery function has risen substantially.

Figure 2 from our study, Disaster Recovery Outsourcing and Customer Experience, shows that the frequency of outsourcing disaster recovery rose from a low of 34% in 2009 to 44% in 2012. Much of that growth came in 2012, accompanying a recovery in IT spending in general and outsourcing in particular. The percentage of organizations outsourcing disaster recovery, however, has yet to return to its prerecession level.

DisasterRecoveryOutFigRB1 - Disaster Recovery Outsourcing Rises with Cloud Services

A very significant development in disaster recovery outsourcing within the past year involves a move to provide infrastructure for such services from the cloud. Disaster recovery as a service has grown more popular, offering the potential for greater flexibility, reduced costs, and simpler, more frequent and less expensive testing.

In mid-2012, for example, Symantec and Microsoft teamed up to offer Symantec’s disaster recovery as a service solution for use in recovering Microsoft applications in the Windows Azure cloud platform. The move allows organizations of all sizes to recover data and replicate business applications from Windows Azure in the event of a local failure. Symantec officials believe this will allow customers to more efficiently and less expensively build, manage, and maintain multiple disaster recovery centers. In 2013, Symantec plans to expand its service to include offloading the operational and capital expenses of such centers. A number of smaller solution providers also are offering cloud-based disaster recovery services.

The importance of reducing disaster recovery outsourcing costs cannot be overemphasized. Our study shows that outsourcing of disaster recovery lags because organizations have found only moderate cost success in doing so, despite relatively broad satisfaction with disaster recovery services. Disaster recovery as a service has the potential to change the cost-benefit equation by minimizing operational and capital expenses and enabling a pay-as-you-go model.

To help IT executives understand their options, the full study reports the percentage of organizations outsourcing disaster recovery capabilities (frequency), the scope of work outsourced (level), and the change in the amount of work being outsourced (trend). We also present data on the cost and service experiences of IT organizations that outsource disaster recovery.

We define cost experience as the percentage of organizations that find outsourcing this function costs less, the same, or more than performing the function in-house. The service experience is the percentage that finds outsourcing delivers a service level that is better, about the same, or worse than performing the same function in-house. We also show how these experiences differ by organization size. Finally, we identify the sectors that are most likely to outsource their disaster recovery operations.

This Research Byte is a brief overview of our report on this subject, Disaster Recovery Outsourcing Trends and Customer Experience. The full report is available at no charge for Computer Economics clients, or it may be purchased by non-clients directly from our website (click for pricing).