A data storage crash is the last thing a collision-repair shop needs to worry about. So when John Sweigart realized that the software he was using to manage his business was no longer compatible with the way he was backing up data, he knew it was time for a different option.

The Body Shop, has hundreds of records, including images that are kept on file for appraisers and insurers for at least a year. "It's tons of information, and we've had occasions where the server's crashed and we lost data,'' says Sweigart, principal of The Body Shop. "We have paper files, but we still have to go back and re-create the electronic files."

Since his business has multiple pieces of software to back up and no internal IT staff, Sweigart decided to outsource what had become a headache. He chose Verio, a software-as-a-service (SaaS) backup provider. For US$29 per location per month, The Body Shop has automatic backup of all its disk drives and servers every night.

Before switching to SaaS backup, each Body Shop location kept tapes on hand that an employee had to back up and take home at night. "It turned into such a comprehensive process, and you had to make sure it was done right every night and that someone was actually taking [the tape],'' says Sweigart. "We had an incredible sense of paranoia doing all this extra work, and we needed a better option."

Data backup continues to be a challenge -- at small and midsize businesses in particular -- because it requires a multifaceted infrastructure of backup software, networks, servers, disk arrays and tape systems. Many companies have trouble completing backups in the allotted time, and a significant number of backups fail or complete with errors. Often, companies don't protect machines at remote locations because of the hassle, so there are gaps in backup coverage.

Because of issues like these, more companies are turning to SaaS backup providers, which support and maintain a variety of applications over the Internet without requiring their clients to invest in any servers or install any software on-site.

"Companies are feeling more comfortable with the concept of buying services out of the cloud," notes Carl Howe, an analyst at Yankee Group Research. "I think there's a perception that if it's good enough for Google, it's good enough for me."

Another reason to offload data backup to a SaaS system is the low cost, which can start at US$4.95 per month. But Howe points out that one of the hidden costs of SaaS backup is that companies still have to have a broadband connection and the time to push the data to the service provider.

Using an off-site provider to archive data is not without risks; for instance, the vendors themselves have been known to experience outages. Howe says that prospective customers need to do their due diligence and find out whatever they can about the provider, including how secure their information will be and how long it will take to recover data when needed. They should also ask about service history with other customers to help determine the stability of the provider and whether it's likely to remain in business over the long term.