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In a recently released cloud "Storage products emerging markets forecast" report, analyst firm Taneja Group estimated that the cloud storage industry represents a US$4 billion market today and is set to grow to almost US$10 billion by 2014.

In an era where the volume of information, particularly digital information, is growing exponentially, storage capacity and security have become a major concern for organizations of all sizes across many industries. 

The traditional model of managing data at the local level or within a single organization is becoming too expensive and unrealistic as it requires heavy investment on storage infrastructure to catch up with the pace of data growth and fails to provide critical functionality like disaster recovery. 

Data volumes are expected to grow at a rapid rate and in the face of a struggling economy and IT budgetary constraints, companies are looking at the cloud as a way to deploy infrastructure that can meet IT requirements and budgets.

Cloud storage, which consolidates tremendous resources and then seamlessly delivers them to a large number of users, represents an ideal solution for organizations which are seeking to reduce operating costs, expand storage capacity and enhance data security.

Sharing a similar rationale with cloud computing, cloud storage consolidates and coordinates a large number of independent, small-size data centers in a network to establish an integrated data center which is then made available and accessible to all users, at any time.

The overarching benefits of replacing separated data centers by a uniform platform are significantly reduced construction costs and more effective utilization of resources. It also offers users more choice and flexibility as they can purchase or rent an appropriate portion of the “storage cloud” on an as-needed basis (think pay-per-use model), thus avoiding any unnecessary waste of resources.

In addition, the big storage centers established and maintained by telecom operators -- typically very costly for a single organization to build up -- can serve as a reliable data backup center, providing an additional layer of security and saving a considerable amount of resources.

Government organizations are ideal candidates for cloud storage use because it augments data security reduces costs and enables them to provide better public services. In recent years, natural disasters have been wreaking havoc around the world, from high-multitude earthquakes to tsunamis, floods, and volcano eruptions. These devastating events have as a result, forced government organizations to acknowledge the compelling need to improve their storage systems’ disaster tolerance capability in order to avoid irretrievable loss of critical data. 

This is not an easy task for most local governments given tight fiscal budgets and the substantial costs of constructing reliable backup centers. A backup center when built would also require continuous maintenance and management -- a long-term investment of capital and human resources. One way of reducing costs is for the center to be built, operated and maintained by telecom service suppliers.