In October of last year EMC acquired Berkeley Data Systems, providers of the Mozy online backup service, to form a cornerstone of the storage giant's move into storage-as-a-service. Today the company is planning to push Mozy services - MozyHome for consumers and MozyPro for businesses - into international markets, according to Vance Checketts, COO of Mozy.
Q. Does Mozy have any operations outside of the US at present?
Our current general state of international business for Mozy, is that about 25% of our Mozy customers are outside of the US today, so we already feel like we have a good, strong base of customers. That is a lot of consumers, a lot small businesses - the large enterprise customers are for the most part starting in the US and expanding into other international offices.
We don't have any major enterprise customer in the Middle East at present, but we are very excited to take this existing base of customers and continue to grow it. Some of the things that we are doing along those lines are creating data centres outside of the United States, within the next several months we will have our first data centre in Dublin.
In addition to that, we will be launching versions of the product, websites that are localized in many different languages. Right now it is all in English, but we will have localized product with international data centres, in place by the end of the year.
Q. Building out an international network of data centres will surely be expensive, how are you going to approach this build out?
We have about ten petabytes of data today online, across two full data centres and one partial data centre in the US, and each data centre when fully ramped up will have somewhere between six and seven petabytes. It is a significant investment in dollars, but just to start the data centre, we don't have to build out all seven petabytes at once. We will start with maybe a petabyte and grow that as the customer data grows. It is millions of dollars once fully built out, but it is not necessarily millions of dollars just to get it started.
Q. Do you have any particular targets for growth outside of the US?
We think it is going to grow quite quickly. I almost don't like to admit this, but we haven't done a whole lot for out international customers, we have not gone out and targeted the international markets. So we think that by putting forth a little effort, moving our data centres internationally, and by doing the localizations, we think that we will get a very, very positive response. We already see a large number of website hits to mozy's domain, we get a lot of international visitors that come to the site, and we think that by localizing the product and making it more attractive to them, we think we will be able to convert a lot of those visitors to customers. I see that 25% of our customer base growing very, very quickly to be at least on par with what we have in the United States.
Q. At present most of your billing is done by credit cards, how will you handle international billing in markets where credit cards aren't as prevalent?
We are certainly looking at other payment options as well, maybe PayPal or some other kind of electronic settlement outside of credit cards, but we are also looking to our channel partners. We have a lot of reseller partnerships in place, which are either small regional consultancies or IT firms, or in many cases very large telcos or other technology vendors who will resell or co-brand the applications.
It is very helpful with those partnerships to have someone give us feedback and guidance for the local market, we are working on several partnerships that would give us some good insights into the local market in the Middle East. So we would like to think that we are being very responsive to customer demand, and we know that we have got to do more than credit cards especially as we move internationally.
Q. Outsourcing hasn't made a great impact in the Middle East, and there is also a culture of corporate privacy in the region - how do you plan to build trust to attract customers for online backup?
We live in a world where if you want to do business you have to connect. You have to connect to your partners, you have to connect to your customers, there is just no way around it. You can't just close things down to the point where no one gets outside the firewall. Online data storage is one of the things that companies recognize is not just an interesting fad, but it is actually a best practice. A lot of the industry research we have seen and that we have conducted ourselves, shows that leading organizations look to outsource, or to move protection of critical data assets offsite, and we are as much an offsite storage solution as we are an outsource storage solution - that is critical.
Any large enterprise is concerned about the security of their data, and the answer for us is always around the management of the encryption key that is used to protect the data. While your data may be sitting in a Mozy data centre, if you hold the key to that data, whether you are a consumer, a small business or a large enterprise, we can't do anything with it, it means nothing to us. In the US we will get subpoenas from local courts, and we can't do anything with that, we can't provide the data, if the data has been encrypted with a private key. That is something that is unique to us, especially in the consumer space where we allow even the consumers to encrypt their data with a private key.
Q. You've said that the company may well go beyond just backup services and into the social side of sharing data online, how will you be able to build brand to compete against Google and the other major players in the Web 2.0 world?
If we are going beyond backup and talking about cloud computing, Mozy is the first step in that strategy of cloud computing. We are essentially getting user data into the cloud for the purpose of backup and protection. That is something that is pretty unique, maybe not so much for Google, but if you look at some of the other players like Amazon, which is providing storage for storage's sake - we have storage but we are using it very specifically, for this purpose-driven, purpose-built online backup application.
From there we will continue to add additional services and additional applications that add value, but that leverage the same storage infrastructure, the same back-end system, and that's particularly different from even companies like Google, where we are really trying to bring the user's data into one place, provide value, for many different aspects of which back up is just one, and then allow them to do lots of things with their data once it's there.
And thinking about Google, the user is really not in control of their data, their data is owned by Google. Google has the opportunity to market to you, and to advertise to you. We plan to deliver this [service] in a way that's going to change the economics a little bit, and allow the user to have more control and more ownership of their data and be able to make decisions on who gets access to that. There's going to be interesting, but subtle things, that will change the dynamic of this emerging market that is cloud computing. Q. Do you have a definite strategy for the Middle East at present?
I already mentioned partners - that is going to be key to us to make sure we have some strong partners for reselling. We are still building our partner network in the Middle East - consider this an open call for partners - of two classes, the smaller IT firms that have a good relationship with customers, that we can work with, or the big telecommunications or other technology companies that could co-market or co-brand the Mozy solution for the customer. That is probably the first and most important part of our strategy.
Q. When do you plan to have localized websites and services?
The service is already available in English and US dollars, but we will have the localizations for our first set of international languages, done by the end of this year. That doesn't necessarily include Middle East languages or currencies, but that is part of what we are aiming for right now.
Q. Do you plan on building a data centre in the Middle East?
Maybe, maybe not. We don't feel that we have to have a data centre in a geography to be able to serve it, today all of our customers outside of the US use the data centre in the US. We hope that the data centre in Dublin will be very helpful for a lot of the customers in the Middle East. The way in which Mozy works means the only reason you really have to have the data centre [in country] is if there's legal reasons to have it there. For the technology stand point, it really doesn't matter, in fact further away is probably better.