Are online backup companies ripping you off?

This sponsored post is produced Peter Zaborszky, Manager of BestBackups.com.

There has been a big boom of online backup companies offering to store your data online for you in case something goes wrong with local versions. This is hardly surprising as hard disk prices have been falling steadily since…forever.

But are they actually worth it, or more importantly, if they are more expensive than a local backup at home, is it worth paying that extra amount? I decided to do some calculations to find out just how much more expensive online backups are.

So I went to newegg.com to check out how much hard drives currently cost these days. I’m pretty sure most users will be able to back up everything with 1TB of space, so I decided to check the price of a 1TB external drive. Currently the average price of these is $89.99.

So per GB, this comes to about 9¢.

This doesn’t necessarily help me in my comparison though, as most online backup companies charge for time rather than GB, so you are paying $X per month for X GB storage space. Well, how long does an external hard drive last?

Now, looking at some statistics from Boston Computing, 6% of “computers” will suffer data loss in the next year. So, statistically that means my hard drive will fail every 17 years. While this is a good statistical calculation, I think it’s a bit over the top, as an external hard drive might get damaged from time to time from human error, so let’s say an external hard drive is used for 10 years.

Now we have a time adjusted price per GB for a backup drive at home. 9¢ divided by 10 means 0.9¢ per GB per year (now I know external hard drives use electricity, but let’s assume I’m only plugging it in once a day or every few days, so electricity use in negligible).

Online Backups

I’m going to look for 1TB online backup services, but since that is quite a lot of space, it’s better to use some unlimited space backup services. Since I run a review site for online backups (BestBackups.com), I know that the cheapest services for these are BackBlaze and Zipcloud who charge $5 and $9.95 per month for unlimited space (it is cheaper if you pay upfront).I’ll take an average of $7.50 per month.

$7.50 per month for 10 years is $900. Price per GB? $0.90. So dollar for dollar, cent for cent, you are paying 100x more for online backups.

The Result
Price for online backups: $0.90 per GB

Price for hard disk at home: $0.009 per GB

Does this mean online backups are a con?

I don’t think so. We are of course forgetting about the value that online backup companies add, as well as the “human error” factor when thinking about backups at home, which is probably the biggest risk. What if I accidentally change a file I didn’t want to, and can’t recover the old version? This has happened to me a few times. Deleted files can be recovered, but modified files can’t necessarily.

Online backup companies also back up automatically, which again helps with the human error factor, since it’s difficult to remember to back up at regular intervals.

Some companies offer file versioning which can be very useful if you regularly change files and might need an old version.

Web access is also a plus, although in the era of google drive this is not as much of an issue, most of my documents can now be accessed online.

Conclusion

It is up to everyone to decide for themselves. Paying 100x multiple sounds like a lot, but in the end we are only talking about $5-$10 per month. And you have location redundancy for that, and a reduction in the risk of human error. If you are interested in online backups, and want to find out more, I’ve got plenty of articles and guides on BestBackups, or you can ask me question on twitter @zpeti!