Do Consumers Care Where Their Content Is Stored?

Reading Om’s piece on Pogoplug this week, I started to think about how local network storage and cloud storage are becoming indistinguishable to the end user. While it’s not technically cloud storage, Pogoplug allows you to placeshift by accessing your locally stored content through the cloud, making anywhere access to content much simpler.

Carbonite CEO: Online Backups Sell

My post, How to standout in a sea of storage startups resulted in a spirited conversation, including some really insightful comments here and else where on the web. Raghu Kulkarni, CEO of Pro Softnet, a Woodland Hills, Calif.-based company said not only he is selling his IDrive and IBackup offerings, he is making a hefty profit. Apparently he isn’t the only one seeing brisk sales of online back-up services.

David Friend, CEO of Carbonite emailed to let us know that his Boston-based company is doing well. “We’ve enjoyed 26 consecutive months of double-digit month-over-month revenue growth,” he wrote in an email. He claimed “hundreds of thousands people paying about $50 every year in subscription fees. Theoretically, at 100,000 subscribers, the company could bring in an estimated $5 million a year.

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One Online Storage Startup Backs Up Profits

Last week in my analysis of online storage sector, How to standout in the sea of storage startups, I pointed out that many startups were having a tough time convincing folks to upgrade from free to paying services. That post got many reactions, including a comment from Raghu Kulkarni, founder and CEO of Pro Softnet, a Woodland Hills Calif.-based company.

His company runs two online storage services, IDrive and IBackup. While IDrive is a more consumer-focused backup service, while IBackup caters to the enterprise crowd, because of its additional capabilities. Think of them as Mozy and Mozy pro, says Kulkarni, who claims that his self-funded (bootstrapped) outfit is growing almost 50 percent every year.

Revenues for 2008 are projected to be $12 million, up from $8.3 million in 2007 and $5.4 million in 2006. The company has been profitable for three years now, but Kulkarni declined to share profits data. At present, the revenues are split 70/30 in favor of IBackup, but he is betting this is going to change soon. “The conversion rate for free to paid for IDrive is about 15%,” he wrote to me in a subsequent email exchange. “Early 2007, we had to create a version of IBackup to compete in the low priced segment, hence the IDrive product offering.” The company has about 250,000 users and stores many petabytes of data, Kulkarni says.