Carbonite (www.carbonite.com), a Boston-based start-up firm formed last year, has launched a new automatic photo backup service that offers customers unlimited storage for $2.50 per month. The new service, called simply Photo Backup, is designed to solve the tricky problem of preserving digital photos. Most people view photographs as items that they hope to preserve for generations, but digital photos, like all digital files, are tremendously vulnerable to any number of disasters, including hard drive crashes, decomposing CD disks, computer thieves, house fires, hurricanes, tsunamis, earthquakes, and angry ex-spouses.

Truly secure backup, even for the most disciplined digital photographer, is difficult. Regularly copying new files to CDs is time-consuming and tedious, and not even that reliable given that experts say that CD disks start to decay in as little as two years. An external hard drive with backup software is not a bad option, but it too might fail, possibly at the same time the primary hard drive fails, say when lightning strikes the pole outside the house. Or both the extra hard drive and the CDs you laboriously copied may go up in flames or float down the river with your computer in a disaster. A truly reliable backup system requires at least two storage locations, ideally well-separated lest some really horrific calamity take out both at the same time. And it requires daily refreshing so that no more than a day's work is lost in a disaster.

Carbonite believes in simplicity: "You push a button and you know there's a copy somewhere."

Carbonite's Photo Backup offers consumers simple, automated, cheap backup that meets these requirements. According to President and CEO David Friend, simplicity was key. "I saw an article somewhere that said that while everybody knows that they should back up their files, only two percent do. So we hired a market research firm to find out why. The answer: the solutions are too complex and expensive." The research firm told Friend and Carbonite Chief Technology Officer Jeff Flowers that a product that costs $3 to $5 a month and is simple would be a success. "It could be the next thing after virus protection and anti-sypware," says Friend. "I tried other backup options, but you need a Ph.D. from MIT to use these frigging things." Most offer limited storage, which forces people to figure out how much data they have (most don't know) and then decide what must be backed up. "Take the iPod," says Friend. "You can get at 10,000 songs with one button. That’s elegant and cool. Backup should be the same thing, you push a button and you know there's a copy somewhere. There's no need for a lot of features. Engineers," Friend warns, "are 'complicators'."

As for pricing, Friend settled on an "all you can eat" pricing plan. At his previous company, FaxNet, which offered fax-to-email and email-to-fax services, a similar pricing plan was used. "You make money on 95 percent of your customers, lose on 5 percent, and it works. Customers love it, they don't have to think about it." Just in case, Carbonite's terms and conditions allow it to "deny service to abusers."

Although a backup service might seem a simple matter of setting up a few servers with big drives somewhere, Friend says that Carbonite couldn't make money using such a strategy. Instead, the firm partnered with IBM to develop a more complex but less costly storage system. Although Friend declines to offer details on the firm's "secret sauce," he says that Carbonite uses a "fairly complex staged combination of three storage media" that automatically migrates older data to the slower, cheaper media. Carbonite expects to file for patents on the technology.

For now, Carbonite stores only one copy of a customer's files, rather than mirroring the data in two locations, which offers the most security. Friend says that mirroring is not worth the extra cost to the consumer because the likelihood that both the Carbonite server and a customer's PC would fail at the same time is "infinitesimal." He explains that the reliability of RAID servers these days is tremendous. And even in a worst-case situation, few if any customers will suffer data loss. "Let's say a 747 hit our server. We would automatically send a command to all the affected users’ computers telling them to re-send their data to a different Carbonite server location. The only customers who could lose their files entirely would be those whose computers happened to fail after the Carbonite server was destroyed but before their files could be uploaded to the new server. Friend says that Carbonite may offer a "three-copy backup" option with mirroring for enterprise users. (The three copies are the user's originals plus two copies stored by Carbonite.) Friend notes that Carbonite constantly checks the integrity of all files it stores. "If a file becomes corrupt, we tell the [customer's] PC to resend."

Carbonite's Photo Backup service is strictly a photo backup service, and does not offer photo sharing or viewing.

Carbonite plans to offer a variety of backup services, all generally identical except for the types of files they cover and the pricing. Photo Backup, which was just launched this month, is the first. Photo Backup offers customers unlimited storage for $29.99 a year. Installation is, as promised, simple: customers enter their email and a password on the Carbonite Web site, then click a button to download and install the software. Once installed, the software automatically identifies any JPEG or RAW files on the computer, then copies them in the background to the firm's server. If there are files or folders that a customer doesn't want backed up, they can tag them "do not backup" in Windows Explorer. The actual process of moving gigabytes of files to the server takes many hours, even over a broadband connection, but because the software uses bandwidth only when the computer has been idle for a few minutes, it has little or no noticeable impact on the performance of the computer or the Internet. Customers can check the status of the backup process by clicking an icon in the Windows "system tray."

Once a customer's files are initially uploaded, the Carbonite software constantly checks for new and modified files, which it uploads as needed. The process of restoring files lost in a disaster is the reverse of the backup process. If only a few files are involved, the customer can easily restore them in a few minutes. A full restoration of gigabytes of files may take a day. Carbonite says that it keeps files that have been intentionally deleted from customers' system for a year, in case someone changes their mind. It also keeps files of ex-customers for three months so they too can change their mind and resume their subscriptions.

The initial version of Photo Backup does not back up video files. However, Friend says the next release, due out in a few weeks, will back up videos under 15 MB in size. He says that Carbonite was worried that customers would intentionally or unintentionally back up huge recorded video files, say last week's multi-hundred-gigabyte football game. "They watch it once, it's not valuable content," Friend explains. "We didn't want to back up a lot of worthless content." However, small videos people have captured with their digital cameras are likely as valuable to them as their photos.

Carbonite's next product, called Total Backup, will back up everything on your PC except applications and system files. So it will include photos, music, video, and all kinds of business and entertainment files. Friend says that when the software encounters a big video file, it may ask customers if they really want to back it up. Total Backup is tentatively scheduled for a May launch at a price in the $50 to $60 per year range. A third product, called Office Backup, backs up everything except entertainment files, for example Word, Excel, PowerPoint, Quicken, and Acrobat files. Office Backup will probably cost around $30 per year. Friend says that Carbonite is also looking at offering one-off backup products targeted at specific markets.

Carbonite's marketing strategy is still embryonic. The firm's main marketing thrust at the moment is to offer three months of free service to all comers. Unlike most offers of this sort, Carbonite is not asking for credit card data so that it can automatically start charging after the free trial ends. Friend notes that a lot of people are hesitant to give their credit card information, and he didn't want this to be an obstacle to the free trial. Our guess is that most customers will sign up for the paid service at the end of the free trial, because otherwise they will have to resume the tedious task of backing up manually or will go back to being unprotected.

If you want your photos to last as long as this guy (Star Wars' Hans Solo, entombed in carbonite), you'll back them up online.

Carbonite has also cut a promotional deal with Staples that offers digital camera customers a free "Digital Photo Protection Kit" consisting of a six-month subscription to Photo Backup. Carbonite is looking for additional retail deals as well as deals with manufacturers of cameras, online photo services, and other firms that deal with photo consumers. Carbonite may also do some promotion in publications targeted at photographers.

Friend says that Carbonite's goal is to have three million users in the U.S. two years from now. That's a lot of users, but we think it's not unrealistic given how unsatisfactory other backup alternatives are and how pressing the need is with the ranks of digital photographers growing in leaps and bounds. In fact, we wouldn't be surprised if Carbonite does better than its goal.

One intriguing question is how Carbonite's Photo Backup service fits with the many online photo services on the market such as EasyShare Gallery, Shutterfly, SmugMug, and Snapfish. In one sense, these services can be seen as competitive, since a customer who uploads photos to an online service has effectively backed them up and might not perceive a need for Carbonite. But the differences are perhaps more important. Online photo services seem to be evolving into three categories: print-oriented services like EasyShare Gallery, Shutterfly, and Snapfish that are free but offer limited storage and cramped viewing; sharing-oriented services that offer excellent viewing and unlimited storage for a fee (Kodak Gallery Premier, SmugMug); and storage-oriented services that offer no viewing or printing, but excellent backup and unlimited storage (Carbonite). Given these differences, it's quite possible that many customers will use more than one online service.

However, it remains to be seen if this division of labor will persist. Our guess is that the big online photo services, particularly the print-oriented services, will move as quickly as they can to match the automatic backup feature offered by Carbonite, either by copying it or by buying the company outright. The online photo business is highly competitive, and all are hunting desperately for ways to add value and generate more revenue in their chronically unprofitable businesses. Another possibility: Carbonite could leverage its photo backup service into a full photo viewing and printing service, though such a strategy would violate its mantra of simplicity and divert it from its core backup business.

Carbonite's backup service as well as the online photo services can be seen as the cutting edge of a much bigger trend that has been sweeping the entire computer industry: improved Internet bandwidth is making it feasible to move resources, whether data or software, away from individual computers and onto Web servers. A server-based strategy is intrinsically more reliable as well as more portable than a PC-based approach.

Newly-minted digital photographers are just beginning to grapple with the implications of the technology, and very few have really thought through how they want to view, share, and store their photos. Most simply throw their photos in a folder and pray that their PC makes it through another day. But over time, they will realize that a PC is no place to keep photos you want to share with future generations. A few hard drive crashes and some savvy marketing from Carbonite (and Kodak and HP...) will eventually convince them that their photos belong on the Internet.