Some Common Misconceptions about Data RoomsAuthor: Daniel Mather
Over the last decade or so, the evolution of cloud computing technologies has led to huge advancements in the data sharing and storage industry. Once we realised that we weren’t being as efficient as we could possibly be while we used physical methods of data storage, we set out to find a replacement. The initial problems were that of security, as the evolution of digital security seemed to be delayed behind the growth of our technologies. That is until the creation of virtual data rooms (VDR). The use of VDRs by corporate companies has spread around the world at an incredible rate. Because the VDR industry has grown so rapidly, both users and non-users of the storage technology have not been able to keep up with exactly how they work and how they can benefit a company. Here are some of those common misconceptions that need to be cleared up.
Virtual data rooms cost more than traditional storage and sharing methods
This one doesn’t make a lot of sense. It’s possible that it has come about because of that very noticeable bill that you might receive for its use. However, if you consider how much it would cost to print, file and store the same amount of data in physical format you’d notice just how cheap investing in a VDR really is. The cost of the paper, files, rent for the storage space, air conditioning to maintain document integrity, as well as other admin-related expenses like security and staff wages. Not to mention that if you need possible investors or clients to come and view your data, the additional travel costs to get them to your office push the price up even further. The list goes on and the costs pile up. Virtual data rooms require none of these expenses, and you won’t need to incur extra travel costs because they can be accessed from anywhere and at any time.
Why should I pay to use a VDR if I can use free competing technologies like Dropbox?
There’s no denying that there are some free services on the market are pretty good. But (and this is a big but), any self-respecting company should never rely on their services to store their confidential data, and here’s why. The servers that house the data stored in such products are fairly secure, but their defenses are not made to keep out experienced attackers. They are made to keep the everyday user’s data safe enough that they shouldn’t need worry about their personal photos or files being leaked. Virtual data rooms, on the other hand, are purpose-built around business security. The security features that they offer are industry-leading, and will pretty much guarantee the safety of your information. Features such as multiple firewalls, high-end 256-bit data encryption and even backup servers are simply not offered by the free technologies.
I don’t need a VDR if I’m not working in M&A
Although they might have been created with the intent of making M&A more efficient, virtual data rooms have evolved into so much more than that. They are now used in various industries that we may never have expected to see them in. They are used by law firms, start-ups, investment banks, auditing firms, real estate, technology companies, and even just as a medium of general board communications. Any industry you might find yourself in will benefit from the use of a VDR: a secure and efficient means of data sharing is necessary at any time.
It doesn’t matter which VDR you choose
Perfect competition does not exist. As with any product in any industry, there are bound to be some differences: some that might benefit you, and some that might harm you. As such, it’s important to do the proper research into which data room you choose, as not every solution might be the right one for you. You can be fairly sure that most will offer good security features (that is what VDRs are made for after all), so it’s the other features you should be sure to look for. For example, some might offer better or wider operating system compatibility. For a company that might be using both windows and iOS devices, that might prove to be invaluable, while for other companies it might not.