Shrinking head counts in the IT department are forcing managers to consider outsourcing their storage needs, but the solution is far from perfect.

Ontario Business Connects (OBC), the government’s initiative to simplify and streamline registration, renewal and reporting processes for Ontario

businesses, has made an online storage solution from Santa Monica, Calif.-based Xdrive Inc. part of its storage system. Amin Remtulla, OBC’s manager of operations and technology, says an online storage solution from a third party was the only way to share information with people in remote locations or with other companies, without giving them dial-up access behind its firewall, which would raise security concerns.

“”Because we can manage all the user IDs and what each ID sees, we can create virtual storage areas for each initiative,”” says Remtulla. “”Where we have people who participate in more than one initiative, we can tailor what they see as well. We can upload easily, and we like the speed.””

In his research, Remtulla says this was the only solution he found that would host a company’s documents and let the client manage them. While he’s satisfied with the security of the system, Remtulla says he definitely wouldn’t place anything that’s politically sensitive there.

“”That’s just the wrong thing to do, that should be on your local servers,”” he says. “”What we put (in online storage) is things that aren’t meant for the general public. But if it did leak, we’ve assessed that it wouldn’t be a problem. We don’t publish highly sensitive information on those sites.””

Lynette McMahon, manager of workgroup products for Xdrive, says her company has worked hard to ensure the files clients store with them are as secure as possible. “”We also do daily backups of all the data, so if for some reason something is accidentally deleted we can retrieve it for them,”” she says.

McMahon says the advantage of an online storage solution like Xdrive is that it can be accessed anywhere via a Web browser, without installing any special software. “”Major corporations are cautious about even their own employees having access to their network from the road, much less sharing information with vendors and partners and contractors.””

The cost is based on the amount of storage space and number of users, and the company itself acts as administrator, creating and deleting users as needed and setting permission levels without having to go through Xdrive.

McMahon says it’s a solution more companies are looking at to take some pressure off their strained IT departments.

However, Alan Freedman, research manager of infrastructure hardware at IDC Canada, says third-party online storage hasn’t really gained traction yet as a viable option for a company’s storage needs, for a number of reasons. Security remains a big concern, with companies wary of putting corporate data on outside networks, and Freedman says storage providers will have to overcome that perception of be

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