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Carbonite Launching Disaster Recovery as a Service (DRaaS) in 2018

Carbonite’s Mohamad Ali
Carbonite's Mohamad Ali

Carbonite is preparing to launch a disaster recovery as a service (DRaaS) platform in the first half of 2018, according to CEO Mohamad Ali. Partners -- including MSPs -- will play a key role in delivering the DRaaS service to midmarket customers.

Carbonite apparently "teased" plans for the DRaaS offering during an analyst day in September 2017. Pressed for more details during an earnings call last week, Ali said the DRaaS offering has entered an alpha- or beta-testing stage -- with a production launch expected next year.

"I'm very, very excited about that product," Ali said during the earnings call. "And in early 2018, we will launch that product. I mean, we have it up and running in an alpha or beta type setting, and we have a few partners looking at it. We're going to move as aggressively as we can there. But in terms of launching the product, that's a sort of a first-half 2018 -- hopefully on the earlier side of the first-half. And it is a wonderful product. I mean, we actually just did a demo on this partner call that we had earlier today, and we had great feedback from the partner."

Carbonite's Evolution

Ali has aggressively expanded Carbonite beyond its consumer and SMB roots over the past couple of years. Ali's strategy, which he explained to ChannelE2E in July 2017, calls for organic R&D and acquisitions that address backup, disaster recovery and high availability across physical, virtual and cloud platforms.

Carbonite VP Jon Whitlock exits backup provider

Key acquisitions have included Data Castle, DoubleTake and EVault. Generally speaking, the tuck-in acquisitions involved high-performing technologies that never quite set the market on fire under their former owners. The approach allowed Carbonite to avoid M&A bidding wars while remaining focused on Ali's long-term priorities.

At the same time, Carbonite has launched a unified partner program and associated portal that allows MSPs and VARs to source all company services from a single location. Channel Chief Jon Whitlock described the partner program's direction in this April 2017 podcast.

The results look promising. Carbonite's revenue surged 19 percent to $61.6 million in Q3 2017 vs. the corresponding quarter last year. Also, bookings rose 21 percent to $59.7 million.

Still, the company had a small net loss of $3.6 million in the quarter. And competition will likely intensify in the data protection market, especially as vendors pursue MSPs to deliver DRaaS and more.

DRaaS and Business Continuity Competition

Numerous technology companies have promoted DRaaS to MSPs in recent years. However, the results have been mixed.

Cloud- and appliance-driven backup and recovery services have been widely popular with MSPs. But full-blown disaster recovery in the cloud (during which customers jump to virtual off-premises systems after an on-premises outage) has taken longer than expected to go mainstream.

Still, there are signs of progress on multiple fronts. Datto is increasingly considered the 800 pound gorilla in the MSP-centric data protection market. The company is set to merge with Autotask later this quarter and will double-down on its pure MSP base.

Additional rivals (including Acronis, Barracuda MSP, Continuum, eFolder, InfrascaleSolarWinds MSP, StorageCraft, Storage Guardian, and Veeam) have sticky relationships with MSPs.

Just to make things extra interesting, ConnectWise is reselling six BDR (backup and disaster recovery) solutions to its MSP base, though Infrascale earned the largest spotlight during ConnectWise CEO Arnie Bellini's IT Nation 2017 conference keynote last week in Orlando, Fla.

Also, keep an eye on eFolder -- which gained DRaaS technology through the Axcient merger earlier this year.

Carbonite: Going Midmarket?

Despite all of that heightened competition, most of the MSP-centric offerings focus on SMB clientele. It's a safe bet Carbonite's DRaaS offering will have more of a midmarket approach.

As Ali explained during last week's earnings call:

"Three years ago when I joined the company, getting some of these larger partners interested was difficult because we just had that endpoint backup product and server backup products just for simple, low complexity environments. It was hard to get partners' attention. If you scroll forward to today, we have a solid midmarket endpoint product, we have a solid midmarket server product, we have a solid DRaaS product, we have a solid high availability product, we have a solid migration product, we have a solid archiving product. And so it's a much more interesting discussion both for us and for those partners."

The discussion should get extra interesting when the new DRaaS service launches sometime in 2018.

Joe Panettieri

Joe Panettieri is co-founder & editorial director of MSSP Alert and ChannelE2E, the two leading news & analysis sites for managed service providers in the cybersecurity market.