Colorado Springs News, Sports & Business

Alliance targets midsize businesses for new products

by WAYNE HEILMAN wayneh@gazette.com - Updated: January 25, 2014 at 7:10 pm 0

lliance Storage Technologies aims to grow bigger by thinking smaller.

For the most part, the Colorado Springs-based data archiving company has been selling to large corporations and government agencies. But to grow - and grow substantially - Alliance is broadening its product line to target more small and midsize businesses.

"We hope to double or triple our size over the next three to five years with our new products, which allow users to start with a smaller and less costly archiving system and expand it over time as their needs grow," said Chris Carr, Alliance's owner and CEO.

That's not the only dramatic step for the 11-year-old company. To accommodate the anticipated growth, Alliance recently moved its headquarters to a former CD-DVD manufacturing plant in the InterQuest business park, giving it 20 percent more space over its previous location. The company will begin producing its data archiving systems there next week.

Carr started the company in 2003 to sell new and refurbished optical disk drive libraries, parts, accessories and maintenance services for manufacturers that included H-P, IBM, Plasmon Holdings and Sony. Alliance expanded into manufacturing in 2009, when it bought Plasmon's assets from a California bank and hired many of the company's former employees after a management buyout collapsed during the 2008 financial crisis and the company ended up in receivership.

"After purchasing Plasmon's assets in 2009, our goal was to aggressively move forward to establish (Alliance) as the continued leader in professional data archiving," Carr said. "Now that we have achieved that goal, additional (space) is necessary to support our growth as we continue into 2014 with the launch of our new line."

Design has flexibility

These days, Alliance is manufacturing data archiving systems that store from 60 gigabytes to 38 terabytes (38,000 gigabytes) and sell for $3,000 to $120,000. The systems use two-sided ultra density optical (UDO) disks, developed by Plasmon, that hold 30 gigabytes of data per side, and can store information for decades to help companies meet federal regulations covering financial, medical and other records. Larger systems have robotic components that move disks into drives as data is accessed and include servers and solid-state disks to make data more readily available.

"Our new systems are highly configurable, and the feature sets can be designed to meet the needs of any size organization," Carr said. "Those systems will allow more us flexibility in designing the type and size system that customers need."

It's not just design flexibility that helps Alliance's bottom line, however. Plasmon's UDO disks - the backbone of Alliance's systems - are so durable, they survived Hurricane Katrina. The Southeast Louisiana Veterans Health Care System in New Orleans had just begun using a Plasmon archiving system when the storm hit in 2005. Nearly all of the patient medical records and images stored on 1,100 UDO disks remained intact despite exposure to high temperatures, humidity and brackish water for more than a month. The U.S. Department of Veterans Affairs has used a Plasmon archiving system since recovering the data in 2006.

In November, Alliance sold multiple data archiving systems to the Sangamon County (Ill.) Circuit Court Clerk's Office to archive 1 million new court documents, including dockets, annually while still retaining the ability to access archived records quickly.

"We were looking for an archival storage solution that could meet our requirements: reliability, performance, cost-effectiveness, secure protection and easy integration with our imaging software," Debbie Cook, Sangamon County's manager of information systems, said in an Alliance press release.

Alliance in growing mode

Privately held Alliance doesn't disclose its financial results, but the company has nearly doubled its staff in the past five years to 47 employees. The company also uses seven contract workers to manufacture its storage systems and service older systems using similar technology.

Much of what Alliance does can be traced back to another company, Phillips LMS, where Carr spent four years as an engineer. Phillips later became Plasmon, and many Alliance employees worked for Plasmon, Phillips and earlier predecessor companies that developed the UDO optical disk technology still used in Alliance's Plasmon product line.

"We still employ some of the engineers who developed this technology in the 1980s," Carr said.

Alliance is now expanding its product line to include new technologies that include high-capacity, high-quality Blu-ray Discs, archiving in the cloud and software for data encryption and decryption to enhance security. The new products, he said, will be able to recover data four times faster than previous products.

"Our tradition is building professional data archiving solutions, and these new products are a continuation in that same market but take advantage of the latest technology," Carr said.

By using the high-capacity, high-quality Blu-ray Discs, the company also moves to a more mainstream technology than the niche UDO format, said Tim Summers, Alliance's senior vice president of product development and a former Plasmon executive.

The Blu-ray Discs also allow Alliance to store more data in a smaller cartridge, enabling the company to reduce the size of its system by up to 80 percent so it will take up less space in offices or data centers, he said.

"These new offerings really put us in a position to greatly expand into new markets. Small and midsized businesses will be much more likely to use our archiving system if they can get into a system at a less expensive level," Summers said. "Companies like Microsoft and others are spending heavily to reach these markets by putting data and applications into the cloud."

Alliance has plenty of room to ramp up manufacturing of its products after moving to the former Mitsui Advanced Media manufacturing plant last month.

A limited liability company set up by Carr acquired the 18-year-old plant in April for $2.5 million, or about 10 percent of what Mitsui spent to build it.

The 51,588-square-foot building is about 20 percent larger than a building Alliance leased a half-mile west on the same street and also includes a 20,000-square-foot vacant mezzanine level and 5 acres where another 50,000-square-foot building could be built to accommodate Alliance's expansion needs for years to come, Carr said.

"We're thrilled they have chosen to grow here. They saw the opportunity to take advantage of well-priced real estate in a down economy," said Tammy Fields, senior vice president of business development for the Colorado Springs Regional Business Alliance. "The data storage industry is evolving quickly with Alliance and many companies in this region coming out with new products. Alliance is a key part of the data storage sector, which is very important to our region."

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Contact Wayne Heilman: 636-0234

Twitter @wayneheilman

Alliance Storage Technologies Inc.

Address: 10045 Federal Drive

Employees: 47 permanent and seven contract workers

CEO: Chris Carr

Started: 2003

Products: Data archiving systems and media

Source: Alliance Storage Technologies Inc.

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