David,

I suppose everyone has their own definition of what’s “economical.” I’m on very limited funds, and even I think your $50/yr. subscription price is obscenely low. I understand that you’re trying to attract customers, but there’s a price-point where you start attracting people who are unlikely to stay for a variety of reasons. I think you’re well below that. I would support both $100/yr. for 300 GB, and then additional tiers.

If I may switch topics slightly, there are some changes to your client that would really help laptop users. Most important would be the awareness of the type of internet connection. I’m typing this email on the road to a meeting, and I darn sure wouldn’t like Carbonite backing up stuff on EVDO unless I explicitly order it to. True, Carbonite can be disabled, but it’s actually designed to be forgotten.

Meanwhile, I really need to back up that USB drive. Can you offer any ETA on your new product?

Scott

Scott:  The policy is 60 days.   If you delete a file on your PC, we delete it 60 days later.  That gives you plenty of time to change your mind or download the file to another PC using Remote File Access.  If your whole computer is disconnected from Carbonite, i.e., there is no explicit Windows file deletion, we store the files for as long as your subscription lasts. 

You’re correct that we should be moving to an archival model, and that is indeed on the roadmap.   However, it just doesn’t work economically with an “unlimited” pricing plan.  Just like any all-you-can-eat plan, your economics are based on averages – you’re always going to lose money on a small percentage of users.  In the case of archiving, large users would so skew the formula that everyone would have to be charged substantially more money, and we would no longer be competitive with vendors who offer tiered pricing.  All the giant users would migrate to us, and the bulk of the average users would migrate to a competitor. 

Dave

David,

I am amused to think of Leo paying for the terabytes he backs up! However, your response raises a very interesting and important issue. You say that you’re currently only in the “back up” business, meaning that Carbonite mirrors protected files on internal permanent drives. Very well, but what happens when a file is deleted locally? How long does it take for your client to report the deletion, and then, for your servers to delete the backup? The various comments from Leo in his multitude of podcasts suggest that he uses Carbonite as short-term archiving. Indeed, the distinction between a “back up” and an archive is fuzzy and entirely dependent on the answers to the above questions.

In essence, I’m suggesting that those questions have to be answered the same way regardless of a file’s location. After all, Windows doesn’t care where your Documents folder is, so why should Carbonite? Your concerns are valid, but they are equally valid for internal drives. If you have folder X on an internal drive, you can swap files into and out of it. Of course, Carbonite will eventually delete files that aren’t in X presently so why should a USB drive be any different? A drive really is just a folder on steroids.

In my case, 250 GB would be plenty. Even 150 GB would be enough, if I can pick the files. But, why should anyone tell me what I can safe-guard? I suppose that’s an argument for tiering. You see, once you get past exceptions like Leo who are drowning in bandwidth, you see a much drier landscape. We have bandwidth, but nowhere near what the San Francisco and New York pundits assume is the norm. Those people who think it’s time for IPTV are in for a wait. Most of America is a good piece below the cloud so ubiquitous real-time cloud-based services are a pipe-dream for us (literally), and will be for the near future. If Carbonite wishes to be relevant in more than a few places, I think you must shift to an archival model because average users simply don’t have the bandwidth to make “cloud” back ups worthwhile. Restoring any large amount of data would be painful.

Scott

Hi, guys.   There’s a technical issue and a commercial issue.  Leo is exactly right about the $5/mo.   We already lose money on a small percentage of our users, and that’s the price we pay in order to make it really easy for everyone.  However, we don’t want to make the economics any worse than necessary or we’d have to raise prices for everyone.  A small number of users already use a highly disproportionate amount of our storage.   The alternative would be to charge by the gigabyte like most of our competitors do, or simply shut off your backup without notice if you get too big, as one of our “unlimited” competitors does.  There’s no free lunch, and none of us can afford to back up more than about 150GBs without losing money at $5/mo.   In a few months we will have a new product on the market that will backup USB external drives, NAS, and any other lettered drives.  But pricing will be tiered by the GB, not unlimited.  I’m sure people will buy one license and back up all their PCs, and that’s fine. 

Regarding USB drives, here’s why we don’t back them up today:  What should we do when the drive is unplugged?  Do we assume that the data is deleted and so delete the backup?  If not, then we are essentially archiving the data, not backing it up.  If we don’t delete data when you unplug the drive, someone could fill up an external drive, load it up to Carbonite, erase the drive and fill it up with other data, and repeat.   This is not what we’re getting paid to do and it wouldn’t make any economic sense at all.   If we’re charging you by the GB, then of course we’re happy to archive as well as back up. 

Hope that answers the question.  

Dave

David Friend | Chairman & CEO
Carbonite, Inc. | 177 Huntington Ave., 15th Floor | Boston, MA | 02115
Office: 617-587-1110 | Fax: 617-587-1101
www.carbonite.com  

No virus found in this incoming message.
Checked by AVG - www.avg.com
Version: 8.5.409 / Virus Database: 270.14.1/2407 - Release Date: 10/01/09 18:23:00