The importance of e-mail archival services is heightened in this age of regulatory compliance requirements and clamped-down federal oversight. Even an increasingly paperless society must maintain a paper trail, making this in-demand aspect of the telecom industry another revenue-generating opportunity for agents.
The Yankee Group recently published a report titled, Message Archiving: Bridging Security and Storage Markets, that predicts significant market growth in e-mail archiving services. Major vendors in this space include partners KVS Inc. and EMC Corp., Hewlett-Packard, ZANTAZ and Iron Mountain.
E-mail and instant message archiving combine information life-cycle management and storage techniques to provide business solutions for data retrieval, writes analyst Stephanie Balaouras. The $140 million worldwide market for messaging archiving solutions will double in 2004. The Yankee Group predicts convergence in storage, content filtering and archiving markets driven by regulatory requirements for end-to-end messaging security solutions throughout 2004 and into 2005.
The report unknowingly builds on a separate one published last year by Osterman Research Inc. that showed many companies in regulated industries mistakenly believed regulations governing e-mail retention did not apply to them. This misperception placed them at greater risk of for liability and the loss of critical information, the firm said.
“There are a number of messaging-related challenges facing an organization today, including rapid growth of the size of message stores, increasing storage costs, and the difficulties of archiving all the data that must be retained in order to meet regulatory and other requirements, Michael Osterman, president of Osterman Research, said at the time.
The regulations Osterman refers to include the Health Insurance Portability and Accountability Act and Sarbanes-Oxley, which Yankee Groups Balaouras writes limit the use of e-mail to send personally identifiable health information or financial data, to ensure confidentiality and records management. Organizations must formulate written policies regarding recordkeeping; train business and IT staff in records management; and invest in security and storage technologies to comply with these rules, she writes.
Fortunately, unlike Osterman Researchs findings in 2003, companies this year seem to have a newfound awareness of the information contained in e-mail, Balaouras notes. Organizations of all sizes, in sectors from manufacturing to retail, recognize the business value brought by well-defined data retention policies that meet and sometimes exceed regulatory requirements.
The Yankee Group analyst points out the key criteria for evaluating e-mail archiving solutions: ease of access, information retrieval features, storage management and hardware costs. Solutions need to empower users to manage their own e-mail archives and accommodate at least 1MB per day for e-mail storage, writes Balaouras. This adds up to a storage need of at least 1.1TB (RAID 5 protected) per year for an organization with 5,000 employees (assuming average of 30 30KB e-mails per day for 250 days).
She says one year of e-mail must be archived for at least three years, emphasizing that the average size and number of e-mails sent and received continues to grow each year.
Archival software alone generated $140 million in revenue in 2003, and this will grow to $420 million by 2008, fueled by the growing market for end-to-end e-mail security services, cheaper and faster network accessible storage, and combined backup and archiving solutions for e-mail and other business-critical data, Balaouras reports.
In terms of the market, Yankee Group cites several providers services as strong. BT Syntegra, partnered with iLumin, is one, along with MessageRite, for messaging management. Antispam and business continuity service providers like MessageLabs, FrontBridge and MessageOne can add transparent archival services on top of existing content filtering, antispam and business continuity services, and are likely to do so within the next 12 months, says Balaouras. E-mail focused providers will challenge successful pure-play e-mail archiving and storage providers like ZANTAZ and Iron Mountain in the market for e-mail archiving.
The Yankee Group report also notes that software made up two-thirds of the overall archiving revenue in 2003. And with the firm estimating implementations cost approximately $1 million for a midsize enterprise, telecom agents would do well to incorporate e-mail archiving services into their regular portfolio of offerings. Significant growth will occur in e-mail archiving services in 2004 compared to previous years, as providers get closer to offering end-to-end e-mail processing services, Balaouras concludes.