Business case

Online backup sounds like an interesting business opportunity, you agree, but what about the money? Well, we believe that at this point in time, in the early stage of the product lifecycle curve, significant margins can be made by "early movers". The numbers speak for themselves and are compelling.

Obviously a real business case has many variables which are specific to your situation, so we limit our example to the cost and revenue elements we know and can influence:

Suppose you sell a "Business" online backup service and the average customers revenue is € 50/month and requires 10 GB of storage. Let's further assume you are able to attract 100 customers in year 1, 200 in year 2 and 500 in year 3.

As we assume that your company already deploys some form of online service we tend to ignore the costs of hosting and bandwidth. In practice your business customers use their bandwidth during daytime and at night, prime backup hours, it normally sits idle. Further we leave out your internal management costs and marketing expenses, as these activities fit within your normal business operations and usually require no additional funds, you are just using the existing capabilities better by adding online backup to your portfolio.

What is interesting about the IASO proposition is that you are building up a recurring revenue base for a "sticky" type of service. Customers usually value their backup very much and tend not to move it from one provider to another easily, just to save a couple of euros per month. Imagine an average € 50/month customers return over a 5 years period....