Home > Articles > Cisco Network Technology > General Networking > The Business Case for Storage Networks

The Business Case for Storage Networks

  • Sample Chapter is provided courtesy of Cisco Press.
  • Date: Nov 18, 2004.

Chapter Description

This chapter covers the copious non-technical reasons for preferring storage networks, from the legal implications of Sarbanes-Oxley to the economy of scale created by their usage. Discover the other advantages storage networks could provide to your business within.

The Impact of Legislation on IT

Several new regulations and acts of legislation will likely increase the corporate data growth rate and will most assuredly change the way companies manage storage resources.

As the following examples indicate, the standard operating procedures of business are changing, and the impact of these changes on financial services and healthcare business systems will be significant, particularly on downstream functions of the storage value chain (offsite data storage, storage-related professional services, and so on).

Regulation Fair Disclosure

When the bull market of the late 1990s was capped off with the NASDAQ crash and the deflation of the Internet bubble, a sobering and humbling string of corporate scandals surfaced just in time to keep the bad news flowing. With the passage of Regulation Fair Disclosure in 2000, the SEC instituted, at least on paper, the first in a long series of efforts designed to limit the ability of the firm and its management to run amok.

In this particular case, "Reg. FD," as it came to be known, outlined a process for limiting publicly traded companies' exposure to the likelihood of insider training. Although Reg. FD forced companies to make the same quality of data available to both analysts and the public simultaneously, authorities did not seek to actively prosecute violators until mid-2001 when cease-and-desist actions were levied against several companies for both intentional and unintentional violations of the regulation. Of course, these actions were obscured a short time later by the activities surrounding the MCI-WorldCom and Enron scandals.

Sarbanes-Oxley

To provide stringent guidelines for corporate governance and in direct response to the debacles at MCI-WorldCom and Enron, the United States Congress passed the Sarbanes-Oxley Act in the summer of 2002. In addition to requiring senior corporate officers to certify financial reports (section 302), blocking personal loans to executive personnel (section 402), and forcing the documentation of internal processes and controls (section 404), the Sarbanes-Oxley Act has potentially far-reaching ramifications to the way companies manage data.

One section of the law—section 409—has the potential to cause significant disruption in current data management policies. In particular, section 409 requires enabling real-time disclosure of pertinent financial data. The impact of this legislation on businesses is such that requirements for storage capacity are likely to increase. Interest in content-addressed storage (CAS) has already increased primarily because of its capability to provide easy access to archived data based on key words and content-specific retention requirements. Compliance with Sarbanes-Oxley will increase sales of networked storage and CAS devices in the near-term.

Health Insurance Portability and Accountability Act of 1996

In addition to Sarbanes-Oxley, the Health Insurance Portability and Accountability Act of 1996 (HIPAA), which serves to make available to every patient in the United States his or her own medical records ("Protected Health Information"), creates a standard interface for the transfer of medical data to ensure privacy and security. HIPAA also establishes measures of accountability in the healthcare industry. Not only does HIPAA complicate backup and retention procedures, however, but it also increases storage consumption rates. As the compliance dates approach, and even the smallest healthcare offices are required to demonstrate some disaster contingency capabilities, storage sales will increase.

NOTE

It is difficult to imagine the amount of data comprising the "Protected Health Information" of every prescription, dental, and medical record of every U.S. citizen. HIPAA requires healthcare providers to keep multiple copies of and lengthen the retention periods for every billing and medical record for every person receiving healthcare services in the United States. That's a lot of data!

Numerous other updated regulations, as well as the aggressive enforcement of laws already on the books, will cause even more headaches for storage consumers while serving to buffer disk manufacturers from a more precipitous drop in revenues.

Title 21

The Title 21 Code of Federal Regulations (21 CFR Part 11), which was issued by the U.S. Food and Drug Administration and announced in August, 2002, promises to streamline the current process for the manufacturing of pharmaceutical products. At the same time, however, Title 21 mandates extension of periods for record-retention. In all likelihood, Title 21 will cause wrinkles in data management programs in most pharmaceutical companies and potentially increase sales of disk devices over time.

Securities and Exchange Commission

Also in August, 2002, the Securities Exchange Commission, together with the Board of Governors of the U.S. Federal Reserve and the Office of the Comptroller of the Currency, issued a request for comments on a draft of a white paper outlining "sound practices" designed to strengthen the infrastructure of the U.S. financial markets.

As a review of lessons learned from the September 11 attacks, the document outlines the lack of controls and processes required to increase business continuance capabilities. The document highlights the need for "rapid recovery and timely resumption" of "critical operations" in the event of catastrophic loss of local or regional disruption, particularly with regard to "core clearing and settlement" organizations whose outages present a "systemic risk" to the stability of the market as a whole.22

The "sound practices" outlined in the document specify the need for identification of critical services and the testing of recovery systems in as timely and as cost-effectively a manner as possible. Most significant in the document is the recommendation that companies providing core financial services implement backup strategies so that time-to-recover and distance functions extend well beyond the capabilities provided by current solutions. The draft of the white paper suggests distances of 200–300 miles for "out-of-region" backup facilities and recovery time objectives of typically same-day at a minimum, if not within a few hours.23

In April, 2003, the interagency group published the white paper and a summary of comments received. Although it is obvious that there is rigorous debate about what constitutes achievable recovery objectives and realistic distance requirements, based on cost-benefit analyses and the technical capabilities of solutions currently available on the market, one thing is clear: The writing is on the wall. The SEC suggests that organizations that perform "core clearing and settlement functions" continue to work toward having these "sound practices" implemented as soon as the end of 2004, and companies that "play significant roles" (those companies who settle or clear five percent or more of the market) should have similar guidelines implemented within three years of the release of the paper.24

In December, 2002, the New York Stock Exchange (NYSE), the National Association of Securities Dealers (NASD), and the SEC, in a joint legal action, levied a total of $8,250,000 in fines against five broker-dealers (Salomon Smith Barney Inc., U.S. Bancorp Piper Jaffray Inc., Goldman, Sachs and Company, Morgan Stanley & Co. Inc, and Deutsche Bank Securities Inc.) for failure to keep communications, in this case electronic mail, in an "accessible place" for the two years stipulated by SEC Rule 17a-4 of the 1934 Securities Exchange Act. 25

Without a doubt, governmental and corporate IT centers find that living with disaster recovery policies and becoming or remaining compliant with current and updated legislation requires a cohesive storage vision to avoid runaway costs and a management nightmare comprised of expensive and poorly utilized storage. Current and future legislation is also in a position to further decrease storage utilization, thereby increasing the storage TCO for many consumers. The following section explains the impact of poor utilization.

6. Utilization and Yield | Next Section Previous Section

Cisco Press Promotional Mailings & Special Offers

I would like to receive exclusive offers and hear about products from Cisco Press and its family of brands. I can unsubscribe at any time.

Overview

Pearson Education, Inc., 221 River Street, Hoboken, New Jersey 07030, (Pearson) presents this site to provide information about Cisco Press products and services that can be purchased through this site.

This privacy notice provides an overview of our commitment to privacy and describes how we collect, protect, use and share personal information collected through this site. Please note that other Pearson websites and online products and services have their own separate privacy policies.

Collection and Use of Information

To conduct business and deliver products and services, Pearson collects and uses personal information in several ways in connection with this site, including:

Questions and Inquiries

For inquiries and questions, we collect the inquiry or question, together with name, contact details (email address, phone number and mailing address) and any other additional information voluntarily submitted to us through a Contact Us form or an email. We use this information to address the inquiry and respond to the question.

Online Store

For orders and purchases placed through our online store on this site, we collect order details, name, institution name and address (if applicable), email address, phone number, shipping and billing addresses, credit/debit card information, shipping options and any instructions. We use this information to complete transactions, fulfill orders, communicate with individuals placing orders or visiting the online store, and for related purposes.

Surveys

Pearson may offer opportunities to provide feedback or participate in surveys, including surveys evaluating Pearson products, services or sites. Participation is voluntary. Pearson collects information requested in the survey questions and uses the information to evaluate, support, maintain and improve products, services or sites; develop new products and services; conduct educational research; and for other purposes specified in the survey.

Contests and Drawings

Occasionally, we may sponsor a contest or drawing. Participation is optional. Pearson collects name, contact information and other information specified on the entry form for the contest or drawing to conduct the contest or drawing. Pearson may collect additional personal information from the winners of a contest or drawing in order to award the prize and for tax reporting purposes, as required by law.

Newsletters

If you have elected to receive email newsletters or promotional mailings and special offers but want to unsubscribe, simply email information@ciscopress.com.

Service Announcements

On rare occasions it is necessary to send out a strictly service related announcement. For instance, if our service is temporarily suspended for maintenance we might send users an email. Generally, users may not opt-out of these communications, though they can deactivate their account information. However, these communications are not promotional in nature.

Customer Service

We communicate with users on a regular basis to provide requested services and in regard to issues relating to their account we reply via email or phone in accordance with the users' wishes when a user submits their information through our Contact Us form.

Other Collection and Use of Information

Application and System Logs

Pearson automatically collects log data to help ensure the delivery, availability and security of this site. Log data may include technical information about how a user or visitor connected to this site, such as browser type, type of computer/device, operating system, internet service provider and IP address. We use this information for support purposes and to monitor the health of the site, identify problems, improve service, detect unauthorized access and fraudulent activity, prevent and respond to security incidents and appropriately scale computing resources.

Web Analytics

Pearson may use third party web trend analytical services, including Google Analytics, to collect visitor information, such as IP addresses, browser types, referring pages, pages visited and time spent on a particular site. While these analytical services collect and report information on an anonymous basis, they may use cookies to gather web trend information. The information gathered may enable Pearson (but not the third party web trend services) to link information with application and system log data. Pearson uses this information for system administration and to identify problems, improve service, detect unauthorized access and fraudulent activity, prevent and respond to security incidents, appropriately scale computing resources and otherwise support and deliver this site and its services.

Cookies and Related Technologies

This site uses cookies and similar technologies to personalize content, measure traffic patterns, control security, track use and access of information on this site, and provide interest-based messages and advertising. Users can manage and block the use of cookies through their browser. Disabling or blocking certain cookies may limit the functionality of this site.

Do Not Track

This site currently does not respond to Do Not Track signals.

Security

Pearson uses appropriate physical, administrative and technical security measures to protect personal information from unauthorized access, use and disclosure.

Children

This site is not directed to children under the age of 13.

Marketing

Pearson may send or direct marketing communications to users, provided that

  • Pearson will not use personal information collected or processed as a K-12 school service provider for the purpose of directed or targeted advertising.
  • Such marketing is consistent with applicable law and Pearson's legal obligations.
  • Pearson will not knowingly direct or send marketing communications to an individual who has expressed a preference not to receive marketing.
  • Where required by applicable law, express or implied consent to marketing exists and has not been withdrawn.

Pearson may provide personal information to a third party service provider on a restricted basis to provide marketing solely on behalf of Pearson or an affiliate or customer for whom Pearson is a service provider. Marketing preferences may be changed at any time.

Correcting/Updating Personal Information

If a user's personally identifiable information changes (such as your postal address or email address), we provide a way to correct or update that user's personal data provided to us. This can be done on the Account page. If a user no longer desires our service and desires to delete his or her account, please contact us at customer-service@informit.com and we will process the deletion of a user's account.

Choice/Opt-out

Users can always make an informed choice as to whether they should proceed with certain services offered by Cisco Press. If you choose to remove yourself from our mailing list(s) simply visit the following page and uncheck any communication you no longer want to receive: www.ciscopress.com/u.aspx.

Sale of Personal Information

Pearson does not rent or sell personal information in exchange for any payment of money.

While Pearson does not sell personal information, as defined in Nevada law, Nevada residents may email a request for no sale of their personal information to NevadaDesignatedRequest@pearson.com.

Supplemental Privacy Statement for California Residents

California residents should read our Supplemental privacy statement for California residents in conjunction with this Privacy Notice. The Supplemental privacy statement for California residents explains Pearson's commitment to comply with California law and applies to personal information of California residents collected in connection with this site and the Services.

Sharing and Disclosure

Pearson may disclose personal information, as follows:

  • As required by law.
  • With the consent of the individual (or their parent, if the individual is a minor)
  • In response to a subpoena, court order or legal process, to the extent permitted or required by law
  • To protect the security and safety of individuals, data, assets and systems, consistent with applicable law
  • In connection the sale, joint venture or other transfer of some or all of its company or assets, subject to the provisions of this Privacy Notice
  • To investigate or address actual or suspected fraud or other illegal activities
  • To exercise its legal rights, including enforcement of the Terms of Use for this site or another contract
  • To affiliated Pearson companies and other companies and organizations who perform work for Pearson and are obligated to protect the privacy of personal information consistent with this Privacy Notice
  • To a school, organization, company or government agency, where Pearson collects or processes the personal information in a school setting or on behalf of such organization, company or government agency.

Links

This web site contains links to other sites. Please be aware that we are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of each and every web site that collects Personal Information. This privacy statement applies solely to information collected by this web site.

Requests and Contact

Please contact us about this Privacy Notice or if you have any requests or questions relating to the privacy of your personal information.

Changes to this Privacy Notice

We may revise this Privacy Notice through an updated posting. We will identify the effective date of the revision in the posting. Often, updates are made to provide greater clarity or to comply with changes in regulatory requirements. If the updates involve material changes to the collection, protection, use or disclosure of Personal Information, Pearson will provide notice of the change through a conspicuous notice on this site or other appropriate way. Continued use of the site after the effective date of a posted revision evidences acceptance. Please contact us if you have questions or concerns about the Privacy Notice or any objection to any revisions.

Last Update: November 17, 2020