April 21, 2006

This is an exclusive interview conducted by (here on referred as “BR”) with Raghu Kulkarni (here on referred as “RK”) , President and CEO of and

1/ BR:Please give us some background information about your company, such as how it was founded, by who, how long you have been around, etc.

RK: service is part of Pro Softnet Corp, founded in 1995. IBackup service was started around 1999, as a division of Pro Softnet Corp.

2/ BR: Is your customer base mainly in US or you have substantial international presence as well?

RK: Customer base is mainly in US, but there is substantial international presence as well.

3/ BR: What are your best selling products and services and why are they selling so well?

RK: IBackup basic service for $9.95/5GB storage that includes online backup, storage and sharing applications is our best selling offering. I think for a small fee we offer an integrated package that combines both online storage and backup, and that is very compelling to users.

4/ BR: What makes your company and its services different from others? Do you have any proprietary technology?

RK: Most of the technology we use is proprietary. We differ from others in breadth and range of services we offer and of course, performance. You can run a typical backup of some 5GB and compare performance of IBackup vs. others, you will see the difference.

5/ BR: One of the biggest concerns of online backup users is data security and privacy. How have you addressed these issues?

RK: We offer IBackup Professional service with 128 bit RC4 encryption on storage, in addition to 128 bit SSL encryption during transmission, with a user defined key known only to users. This key is not even stored on IBackup servers. Even if someone from IBackup personnel were to have access to IBackup professional data, it is not possible to decrypt the data.

In addition, we have physical and other related security measures including 24/7 video monitoring, biometrics, server monitoring using automated tools etc.

6/ BR: What kind of growth rate have you been experiencing and what is your expected growth rate for the next few years?

RK: We have had growth rates of over 100% in the past. Going forward, we expect the growth rates to be between 50-100%.

7/ BR: How has the online backup business evolved in the last few years, and how do you see it further evolving?

RK: Online backup business is now a specialized field with offerings for consumers, small businesses and medium to large enterprises. Even with each category, there are niche areas for specialized backups such as real time backups of certain types of data. For example, we recently launched real time backup for Quicken and QuickBooks data. As broadband adoption continues to grow and the access speeds improve, there will be more applications.

8/ BR: Who do you consider your main competitor(s)?

RK: Connected is a major player in online backup field for consumers and small businesses. XDrive has a strong presence as a combined online storage and backup application for consumers.

9/ BR: Large companies such as Microsoft and major telco’s have started offering online backup business. Do you fear them? How do you plan to compete against such formidable adversaries?

RK: We don’t fear them for the service they offer, but we do for their market reach. We continue to innovate and offer compelling services; that is the only way to fight the larger rivals.

10/ BR: There is a rumor that Google might start offering online storage in the near future. What is your opinion about that?

RK: Yes, I have heard about the GDrive project. Anything that Google does, it does it in a grand scale. So in that sense, everyone in online storage arena needs to worry about them. However, we are not just an online storage service provider. We provide encrypted online backup services as well, and Google is unlikely to get into this field. There may be privacy issues related to GDrive offering that may skittle the project.

11/ BR: There has been quite a bit of M&A activity in the industry lately (such as XDrive being acquired by AOL, Microsoft acquiring Foldershare and LiveVault by Iron Mountain). Do you foresee yourself acquiring or being acquired by anyone?

RK: We are less open than others to being acquired. We believe that we will loose the innovation edge as a part of larger company. This is not to say that we won’t do this in the future. But as a stand-alone profitable company, we don’t have pressing needs to be part of a larger enterprise.

12/ BR: Are there any new products/services you are developing that will soon be available?

RK: We have many products in development stage, but we would like to keep them under covers for now!

13/ BR: How much cheaper do you think the cost of storage will get in the next few years?

RK: It will continue to go down at the same rate as it has in the past. But it may not necessarily be reflected in retail price offering for online backup. There are other factors including bandwidth and infrastructure costs that play a major role, and there is the value of services one offers, most of which is software related.

14/ BR: What do you see as the greatest challenges facing your company today? And what are your biggest accomplishments so far?

RK: Greatest challenge is potential competition from major ISPs and portals/search engines in online storage business. We have created possibly the largest independent integrated online backup and storage service in the world.

Raghu Kulkarni is President and CEO of and

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