Great post Michael.
At Sonian, we saw this trend coming and created the first hosted archive service based on cloud-compute infrastructure. We are using Amazon Web Services to achieve amazing reliability and security and can offer the customer unlimited storage for a very low per user price ($3 to be exact). Our philosophy is the need for archiving is essentially a "man made" problem, and solutions to this problem shouldn't be too expensive, or burden the IT department. The economics for archiving into the cloud are fantastic.
-- Greg @ Sonian - http://www.soniannetworks.com
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