The firm, which works with service providers selling to SMBs, said 70 percent of its partners are in the United States with the remainder predominantly in Europe.

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Lakshmanan Narayan, president of Vembu, said, "There is a boom in online backup services right now. We are looking for 2,000 partners by 2009. SMEs want to backup off site, and service providers lead the way because they act as the outsourced IT department for their customers. Trust is an important element for SMEs when storing data off site and this is why service providers have the edge; they are usually known to the firm and are not just some faceless company coming in taking data."

He added that service providers host the storage for the end user and can white label Vembu's software.

"All the service provider needs is the storage hardware and a decent broadband connection. By hosting, it gives them better margin and means they can offer it as an added service," he said.

Hamish MacArthur, CEO of United Kingdom analyst firm MacArthur Stroud International, said there is a lot of activity in the online backup arena. "At the moment this is mostly from the companies that are offering online backup. Many telcos, including BT in the U.K., have started to offer online backup as part of its services and other telcos are sure to follow this.

"It is the uptake that is always a challenge because of the cost and the comfort factor; it's OK storing off site, but how confident are SMEs about recovering their data? That said, there is an opportunity here that is small but growing."