"At small companies, the email server is often a single point of failure," said LiveOffice CEO Nick Mehta. "If it goes down, employees will usually use their personal email to conduct business while the server is being restored. This can present some security and compliance risks."
However, many SMBs either don't want to pay for a full-fledged email archiving service or feel comfortable sending all email data to the cloud. Mail Continuity is LiveOffice's attempt to offer a "spare tire" for the Exchange server.
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LiveOffice can offer this service for free because of economies of scale in its data center, as well as LiveOffice's use of relatively inexpensive commodity storage and server hardware, Mehta said.
Analysts pointed out it's also an attempt to generate business in a crowded email SaaS market by getting people comfortable using LiveOffice before trying to sell them a full-fledged email archiving or hosting service. "This is clearly supposed to be disruptive as they try to compete in a very competitive space," said analyst Jo Maitland, Forrester Research. "It's a way for customers to feel out what it's like to be in the cloud without moving there completely."
"The challenge for LiveOffice will be to make this known to people and to provision servers very quickly," said analyst Brian Babineau, Enterprise Strategy Group.
A December 2007 survey of 156 email managers by ESG indicated that 35% of organizations conduct only daily full backups on their Exchange servers, Babineau said. "They're willing to lose a day's worth of email," which also indicates that not everyone has a disaster recovery plan in place for this mission-critical application. "If you don't have a disaster recovery plan for email and you want to get something in place, this is an easy way to do it," he said.