< Back to Storage as utilityWhile capacity-on-demand and metered storage options might be over the top for small and midsize businesses, managed storage services could be just right for them.Enterprise organizations that want to focus on their core competencies rather than on IT are the beneficiaries of new, managed, storage services, says Mark Lewis, executive vice president of open software at\u00a0EMC. These companies typically fall within the high end of the\u00a0SMB\u00a0market, he says, and are often on the verge of growing into the next tier. "They are having trouble managing the infrastructure to keep up with their wild success. Typically it is a younger business that doesn't have their own storage infrastructure."HP\u00a0and\u00a0IBM\u00a0each play in the managed storage services arena. HP, which will host the storage at its site or provide storage management at the customer site, aims its service at companies that want to pay for their usage without an upfront capital investment.With IBM, managed storage services typically are done with equipment on the customer's site. However, IBM holds the title to the capital equipment. And typically, IBM acquires personnel from the company whose IT shop it is going to run. Via a service-level agreement, IBM agrees to deliver certain applications and meet performance, availability and uptime requirements.In a collocation offering, IBM maintains the storage assets and the human intellectual property - the customer simply has a paper contract with them, and IBM gives them access over the wire to the storage.Brian Babineau, an analyst for Enterprise Storage Group, speaks to the advantage of using managed storage services: "The advantage is operational efficiency, not necessarily financial benefits," he says. "You are going to use a managed service for secondary capacity and back-up purposes first, and then your low-priority primary capacity. Most companies are not going to outsource primary high-enterprise class capacity."If this discussion of storage outsourcing and managed services sounds like deja vu, it is. During the dot.com boom, a number of storage and application service providers surfaced. Most notably among them was StorageNetworks, a high-flying start-up that raised $456 million in venture capital.But StorageNetworks and nearly every other storage service provider or application service provider failed by mid-2003. Many had bad business models - "StorageNetworks failed because they went after [customer's] primary capacity when most of their customers were focusing on outsourcing tertiary or back-up capacity," Babineau says.But some, like Arsenal Digital, LiveVault, Iron Mountain and AmeriVault, managed to survive. They did so, Babineau says, because they have back-up offerings that let company's take care of their secondary data.