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One of my clients has a small office in a major city that used to be main office for the company.Due to the organizational changes main office was moved to a different country but all equipment and office space are still in place.Now CEO is trying to get value from this office and their IT guy suggested using it as online storage.
So you have an idea this is what they have (list as was given to me):

  • 100Mb/100Mb fiber optic dedicated Internet
  • ADSL Backup line
  • one onsite rack
  • x5 ProLiant DL360 G5 with 6 GB and 250GB array SAS each
  • x2 NAS 4TB LACIE QUAD Drives
  • QNAP 8TB ISCSI Array - main file storage pool
  • 1GB managed netgear switch
  • Fibre optics transcoder (router)

IT guy has written inhouse php/mysql webapp that allows secure online backup based on SFTP/WinSCP uploads for clients.No marketing was done and no business plan is in place.
CEO just wants to keep the costs down for having nearly empty office and would like to use this infrastracture as a revenue source. In my opinion this is a right way to waste money considering existing offers for secure online backup storage and established companies are already offering a lot.
To get it working from what I see would require serious investment in offsite storage replication,removing single points of failure,certification,marketing etc.
Is there better way to reuse this equipment/office?

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up vote 1 down vote accepted

What's your backup power? redundant network connectivity? site security? disaster failover? fire suppression? cooling? SAS 70? Anyone who is looking for hosted storage is going to ask those questions. How will the IT guy answer?

How will you compete with Amazon cloud and Rackspace? They already have the technology, the pricing and the sales and marketing in place.

My suggestions:

sell the equipment and sublease the office;

use the location has a hot/warm failover facility for your other systems (but that would be more expensive than some hosted servers in a DC);

use it for bitcoin mining :-)

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spot on :) .Thank you James. – Sergei Dec 15 '11 at 20:39
rather than bitcoin, I prefer to donate spare CPU time (which we have a lot of) to World Community Grid. – Mark Henderson Dec 16 '11 at 1:08

Well, technically he is dead. This wont work in any way. Reusing the equipment is fine, keeping an office around for that little equipment is - well - making it impossible to make money. This is not even a full rack of stuff. Nice to have - though the servers are crappy, 6gb ram are higher workstation level - but just not worth keeping something running. He should close the office and move the equipment central.

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My understanding is that he does not like the idea of whole rack of equipment doing practically nothing and wants to get some money back that already have been invested in the online backup storage project that never taken off.It does make sense to move it to the proper datacenter though.Making proper online backup solution in my opinion involves more than just a desire to get few dollars back from the cash spent on the equipment – Sergei Dec 15 '11 at 14:26
+1 Move the equipment or sell it off. They're not even going to come close to breaking even trying to resell cloud storage with that. – Chris S Dec 15 '11 at 14:28
Thank you Chris.I think to just breaking even they would need to 1)move it all to the datacenter 2) pay for replication 3)pay for certification 3) pay for proper website or buy ready product for cloud storage 4) purchase extra storage or reuse existing Amazon S3 like offer – Sergei Dec 15 '11 at 14:37
Ebay. Ebay. Ebay. – Bart Silverstrim Dec 15 '11 at 14:37
Bart, I tend to agree, considering how much value it is losing there sitting and doing nothing. – Sergei Dec 15 '11 at 14:42

I dont think he will make money as in profit, but maybe some to cover some costs, I would take all the eqiuipemnt and install it as a cloud server. So have all the storagae and processing power avaialbe under 1 service.

  • Maybe he could undercut other people to offer processing power - you know do some complex jobs across several machines using cloud technology.
  • You could sell of virtual terminals, like remote desktops (with that fibre internet that is perfect) and let people use all the computing power to render videos, graphics etc.
  • Could run some sort of VoiP servers, or sell other companies some cheap VPS's for backup, proxy server.. like voip.

The problem is licensing of allot of software, so mostly everything would need to be open source equivalents to certain applications..

Another thing is - this hardware is nice ... when you use it in a small business environment, but to do rent it out-- he would need to buy a few more servers and defiantly more storage space to able to offer some promising deals, and still then I do not for see any profit until you can 30-60 long term clients that are willing to use this "extra" stuff virtually some how...

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