CTERA’s CloudPlug takes a hybrid approach to storage

It seems like there are dozens of online storage companies around, but a new startup called CTERA says it has the best solution for small businesses — a small device called CloudPlug that sends your data online. It’s launching at the Consumer Electronics Show, and it also announced raising a first venture round of undisclosed size from Benchmark Capital.

The Petach Tikva, Israel company describes its system as “cloud attached storage” and says it combines the advantages of network attached storage (NAS) and cloud storage. As with network storage, your files are first copied to on-site external hard drive. However, the data is then sent, via CloudPlug, to an online storage site. That means businesses can save money and space on hardware (as they would with other online storage products), but the data gets transferred more quickly, it doesn’t require downloading any software, and you can back-up your computer when it’s disconnected from the internet, or even turned off.

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I have to admit, that last item is particularly appealing. Last month, I praised online backup service Backblaze, but I actually gave up on it because the backup only occurred while I was online, which made it really slow (I’m debating whether to sign up again). And I keep hearing that businesses are looking to the cloud as a way to save money on maintenance and hardware. It’s hard to know if CTERA’s cloud attached storage model will be the one to take off, but the backing from Benchmark, one of the leading investors in online business software, is certainly an encouraging sign.

Founder and chief executive Liran Eshel isn’t revealing much more about the product and its pricing, except that it will be released sometime in 2009 and that CTERA will likely sell its offerings through internet service providers.