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Firms Have Made Disaster Preparations for Data

James Grogan is the vice president of strategic alliances at SunGard Recovery Systems of Wayne, Pa. SunGard will be among the firms speaking on a panel about disaster recovery for mutual fund companies at the National Investment Company Service Association's 2002 Technology Forum this week.

Grogan discussed the current state of disaster recovery and business continuity plans for financial services firms following the events of Sept. 11 with Mutual Fund Market News' Andrew Brent. An edited version of their conversation follows.

MFMN: What is your role at SunGard?

Grogan: I'm the vice president of strategic alliances. There are technology alliances between the business continuity group within SunGard and partners that have products or services complementary to our products or services. So, for example, they often are partnerships with either hardware vendors or software developers.

MFMN: What do recovery services encompass for financial services firms?

Grogan: The business continuity that we offer includes the full spectrum of traditional hot site services, where companies would be able to come to our facilities, restore their data and programs, and resume operations in the event that they had any kind of a catastrophic outage at their own facility.

MFMN: When you say, "come to [your] facilities," do you mean have employees physically come there?

Grogan: Yes. We have facilities throughout North America, as well as in the U.K. and France. When a customer subscribes to a service, they subscribe to it based on the systems that they are running in their production data center at home. We would make available to them those same type of systems at our facility, for them to be able to resume their production operation.

MFMN: What about data backup?

Grogan: Typically, in the traditional mode, the customer is going to be responsible for backing up their own data on a daily basis and moving that to an offsite location. The logistics of that are often handled by someone local to where their data center exists. So if they're in the New York area, for example, they may have someone, either in New York or in North Jersey who has the vaults where their tapes are stored.

As an alternative to that, some customers have moved out of the traditional backup solution and moved towards high availability' protection of their data. In that case, we would have electronic copies of their data, which are written from the customer's production facility over telecommunications lines to the SunGard facility, already at our facility in the event the customer experienced an outage in production.

MFMN: How many of your financial services customers use that "high availability" protection?

Grogan: We've probably got, in round numbers, one hundred customers who are using high availability solution. But there are thousands of customers that we have, so those who use high availability are still a small percentage of the customer base.

MFMN: What causes firms to choose one method versus the other?

Grogan: In the business continuity industry, the traditional way that most businesses, probably 95% of all businesses today, do their backup is to tape on a nightly basis. In the event of a disaster, they would bring those tapes with them to their commercial recovery facility, such as the SunGard locations.

The leading edge of new technology, which 5% or so of our customers are using, would shorten the recovery time frame by using an electronic mechanism whereby the data is written both in their production systems and at SunGard throughout the business day.

For customers that have any kinds of concerns about the recovery time objective, they have to come up with a technology that is faster than the physical transit of those tapes and the time it takes to restore tapes at an alternate location.

MFMN: In terms of disaster recovery, what happened to financial services firms on Sept. 11? Were most firms adequately prepared in terms of data protection?

Grogan: Most financial services firms were not impacted so much in their data centers as they were in their end-user areas. Because of the cost of real estate in lower Manhattan, many of the data centers have already been moved to other locations, particularly in North Jersey. Jersey City has many of the data centers from financial institutions. So the data centers themselves, by in large, were not directly impacted.

Most of what was impacted by the attacks in New York City were the end user recovery areas.