Upside to Computer Disasters

Disaster, it would appear, can be a great line of business. According to the market research company Dataquest, retrieving data from physically damaged equipment is the No. 1 market segment for companies in the specialized data-recovery business. Now, with increasing reliance on electronic information, worldwide spending for disaster recovery -- which includes providing back-up networks and computer sites -- is expected to increase 40 percent over the next two years to $1.4 billion.

"Disaster can strike anybody, anywhere" and the largest challenge is educating people that there are alternatives to reentering data, said Marshall Warwaruk, vice president of business development for Ontrack Data Recovery. Ontrack has just opened a federal office in McLean, Va.

A 1995 study co-sponsored by Comdisco of 300 companies that averaged $2.5 billion in annual revenue found that only 59 percent of companies have computer disaster recovery plans.

The part of Ontrack's business that is "really, really starting to grow" is its expert witness program, Warwaruk said. This unit helps clients determine if data was tampered with, stolen, deleted, copied or destroyed. The program is aptly named, because Ontrack is often called upon to share its determination with the legal system.

In a recent case, a company's former employee admitted to stealing backup tapes of mission critical data, but said that he did not load them onto his machine or try to use them in any way and therefore had not violated any confidentiality agreements. Ontrack was called in and found tell-tale signs on the former employee's personal computer that he had indeed loaded the data, tried to alter it and then deleted it.

Employees who have access to a company's network traditionally have been the No. 2 threat to a company's network. But as more companies allow employees to connect to outside networks, either via commercial online services or the Internet, that is changing, said Fred Avolio, product manager for Trusted Information Systems. An outside network attack has replaced employee sabotage the No. 2 threat."Physical damage has been the No. 1 threat for years," said Avolio. When something like the World Trade Center bombing occurs and people can watch workers carrying damaged disks out of a building, there is a surge of interest in off-site backups, he said.

About 20 percent of the disaster recovery business comes from hardware failures, such as system crashes, memory damages, or problems caused by equipment moves, said Comdisco's Diane Laux. A close second is flooding and water damage.

This segment actually represents the largest share of Comdisco's business. A large part of Ontrack's business comes from recovering data from disks or tapes that have been damaged by water or heat, Warwaruk said. And that doesn't just mean equipment damaged in floods or fire. One of the strangest recovery jobs was for a client whose daughter threw his laptop into a hot tub - with him in it, Warwaruk said.

Warwaruk also had a word of caution for computer operators. While summer is a slow period for most businesses, it is the busiest time of year for the data recovery industry, he said. Summer storms and electrical black-outs can cause havoc with computer systems-especially if the company hasn't prepared a disaster response plan.