Blockchain-based storage service takes on Amazon AWS, unveils pricing

A decentralized storage service that rents capacity from users around the globe is among a small cadre of vendors claiming their capacity is cheaper and more resilient than big players such as Amazon S3.

cloud network blockchain bitcoin storage

A cloud storage service first announced in 2015 that uses the decentralized, peer-to-peer architecture of blockchain to store encrypted data on the computers of users around the globe has unveiled its pricing model and production launch date.

Storj Labs, which operates a beta storage service for developers, businesses and consumers, initially launched the Tardigrade Decentralized Cloud Storage Service in August. Today, it announced its Beta 2 release and pricing, taking aim at Amazon's AWS S3 cloud service with what it says is a more cost-effective and resilient approach.

The Tardigrade storage service claims 99.97% availability, and said its prices are less than half the starting prices of legacy cloud storage providers. For example, Amazon S3 list prices are currently $23 per terabyte for static storage per month. Amazon S3 also claims uptimes that range from 95% to 99%.

"Across the three main providers, those prices average at $22 per terabyte for static storage and $99 per terabyte for bandwidth," Storj Labs said in a blog post. "Furthermore, the prices quoted by legacy providers often don't include features like encryption and multi-zone redundancy, which come standard with Tardigrade at no additional cost."

Storj's Tardigrade storage service beta currently has 400 active users.

Users who rent out space on their hard drives earn STORJ, a form of currency that can be used to purchase capacity on Storj's Tardigrade service. (The users earn STORJ by selling excess hard drive space and can use it to purchase space on the Storj Tardigrade Decentralized Cloud Storage Service via the company's file sharing app.)

Storj is by no means alone. P2P compute storage services have grown over the past several years to include a dozen options, but none have seen "reasonable" enterprise adoption, according to Raj Bala, a Gartner research director.

"These services may be half the price of Amazon S3, but they’re 100 times greater risk given the decentralized nature of the storage and the nascent companies behind them," Bala said via email. "Comparatively, AWS is a trusted provider with 10s of exabytes under management. I am also very skeptical of the performance claims being made relative to S3, particularly when objects need to be rebuilt in case a peer in the storage network disappears."

Cloud storage provider Backblaze offers capacity through its B2 service at a quarter the price of Amazon AWS, but without the risk a P2P architecture poses, Bala said.

"B2 is built and operated by sophisticated people from a technical perspective with a successful track record. So one need not use a P2P storage service just to save money," Bala said.

Bala also criticized P2P-based storage services for claiming to use blockchain's innate cryptography and resilliency when, in fact, the distributed ledger technology is only used for the purposes of payment.

Storj Labs' CEO Ben Golub, however, pointed out that in 2017 Amazon AWS storage service experienced a massive outage in the US-EAST-1 region, and while due to human error, it was because of the more centralized nature of the vendor.

Storj's Tardigarde service is fault tolerant because the hard drives are located throughout the world and data is stored in a way similar to a RAID configuration in a traditional storage server – redundancy is built into the scheme.

"The data is encrypted first, so we never see it, and then we tyipcally break it up into 80 pieces of which 29 are necessary to put it back together," Golub said. "But, we can change that math depending on the use case."

The Tardigrade service charges $10 per terabyte per month, or 1 cent per gigabyte, for static storage. (Storing 1 terabyte for 30 days, two terabytes of data for 15 days or three terabytes for 10 days would each be the equivalent of 1 terabyte month). The service charges $45 per terabyte, or 45 cents per gigabyte, of download bandwidth consumed. (Storj does not charge for upload bandwidth.)

Storj Labs Tardigrade cloud storage service Storj Labs

Storage Node Operator Dash Board: Users who are sharing their excess hard drive and bandwidth capacity on the network can use the Storage Node Operator dashboard to understand how their node is performing and how much storage capacity and bandwidth have been used during the month.

"If you choose to take data out, then we charge below our costs to get that data out," said John Gleeson, Storj's vice president of Operations. "Unlike others, we don't want to charge if you want to take your data out."

Atlanta-based Storj Labs is using blockchain to manage a storage aggregator that rewards those who rent out unused storage on their computers with cryptocurrency or with free storage and network capacity.

The storage service uses what it calls "gates" or performance metrics to track its service level agreements. Those metrics include the total number of vetted storage nodes (currently about 3,000); the number of active Tardigrade users (about 400) and node churn, or the number of nodes that opt out and in of the P2P architecture over time (about 1.5% per month).

The Tardigrade Cloud Service now operates with between 4.3 and 7 petabytes of storage capacity. At production launch in January, it plans to have 6PB available for developers and users.

The Tardigrade Cloud Service breaks up a file into 30 pieces that are stored across 80 drives from a pool of 3,000 distributed throughout any of 183 different countries or territories, Golub said.

"This is blockchain at its best, frankly — peer-to-peer networks where underutilized servers are traded," Avivah Litan, a Gartner vice president of research, said in an earlier interview. "It's more or less Uber for computers on a blockchain, so by default the design eliminates the Uber-like central authority and operator and replaces it with smart contracts in a system where no one entity is in control."

The storage service works by first encrypting a file and then breaking that file up and spreading it across 80 or more user drives for redundancy. If one portion of a global network is slow or not maintaining the standard for downloads/uploads, the service automatically chooses different paths with higher bandwidth.

"This is where the power of being decentralized really matters. When we're trying to serve you a file you stored, we need to get 30 pieces to you, but we can get those 30 pieces from any of 80 or more drives that have those pieces on them," Golub said. "If one of them is busy or some of them are on a slow network, it doesn't matter because we're able to take advantage of the fact that we're decentralized and can maintain really high availability and really high durability and performance."

For example, if more than a few thousand users want to view a file stored on the Tardigrade Cloud Service, it can be divided up into 200, 300 or more pieces using dynamic caching and dispersed in a wider global pattern; in the end, only 30 pieces are needed to reassemble the file for use.

blockchain storage Storj Storj Labs/Google Maps

A map showing where Storj farmers and their nodes are located around the world.

"So, if what you want is to store with us this powerful video we can increase the dispersion [for more efficient access]," Golub said. "Initially, we make our best guess as to where to store files so they're sufficiently dispersed on nodes across different networks. Then we can apply algorithms on top of that based on usage patterns."

Developers can join a waitlist to try out the platform and use Tardigrade's Amazon S3 gateway to start using it with existing S3 compatible applications. The site has a native library with several popular bindings, including Go, Python, Swift, Android, .Net and Node.js. for those who want to take advantage of advanced features such as Macaroons.

Users can also upload files through Storj's IPFS gateway. Non-developers can still benefit by signing up on Storj's website and receiving an athorization token to run a storage node. The node remains in a probationary status for the first 30 days as the company measures performance for uptime and response time. Over the first nine months, Storj also holds back a portion of a node operator's earnings until they've been fully vetted to become a permanent part of the network.

Copyright © 2019 IDG Communications, Inc.

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