Network Growth Update

Announcements
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Hello Storj Community,

We are so excited about the growth of customer data that we have been experiencing on the network. It has been quite the journey. It is amazing to realize that two years ago, we were excited by a customer with 10s of TB. Last year we were excited to see customers with 100s of TB. This year we saw a growing number of single digit PB customers. We just signed our first double-digit PB storage customer and we have many in the pipeline. Many of which look promising for us to close on.

Throughout this process, as we have engaged with larger customers, we have consistently received feedback and requirements from large enterprise customers that require their data be stored in facilities with SOC2 or similar certifications. We created the Select tier and commercial node operator program to respond to these requirements. It often happens that opportunities start on the public network and then switch to Select due to a mandate from security and compliance departments. We always push back with the message that the public network is equally or more secure, durable, performant, and more mature, compared to Select and that it is the same underlying technology for everything. Despite this, customers frequently end up with their hands tied due to external requirements which require them to use a “compliant” product.

As we have discussed previously we have been uploading data to the network in anticipation of onboarding a multi PB customer. We had anticipated that this customer would upload to the public network, and as such we did crucial performance testing and scaling on SLC with the assistance of our community. These tests were crucial to our winning this business and we appreciate the input and support we received. As we were working with this publicly traded company, at the last minute they mandated the use of the Select tier for their data, and they have already begun onboarding data to that product. We are saddened that this was the outcome and that our expectations that this deal would lead to growth on the public network didn’t materialize. But we do believe that this will help grow the Storj brand and mature the platform leading to accelerated growth across all products.

To help us expedite further growth with these larger customers, we have also made the decision to obtain a SOC2 certification for Storj as a company. Compliance is a critical requirement for many customers and a SOC2 certification would certainly help streamline adoption of our services. We are hoping to obtain a certification that covers as many of the Storj products as possible, including the public network (though we recognize that this does represent a challenging argument based on the controls required for SOC2.) Throughout this process we are committed to partner with our node operator community to successfully complete this work. If that is achieved it will dramatically increase the demand for the public network.

Despite this push for compliance, many use cases do not require SOC2. We still have a strong pipeline for public network data, as more and more people are discovering the value and performance enhancements of a distributed cloud object storage platform. So while we have seen good growth in the usage of the network, we anticipate continued acceleration of that growth going forward.

Again, thank you for your partnership in this journey!

The Storj Team

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yea… whats the point of Using Storj, if You don’t use “Public” network.

Which only “Public” has the unique attribute of such diversification, from which the performance comes. No way “Select” has it, so it properties must be inferior vs. “Public”, at least at this very moment.

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In the 6 months that the customer was being onboarded, the SOC2 requirement never came up in any discussion.

The customer was onboarded based on the public network benchmarks, which do not in any way reflect the Select results, so was onboarded with requirements that were far lower than what was originally discussed.

“What if I told you, the wolves aren’t real?”

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This is the evolution.
We have to understand running the nodes on some cheap outdated hardware having much higher failure rate, running on home lines by operators not capable of solving very basic issues is simply unnecessary expense for Storj as a company - in terms of the repair traffic, support, code workarounds etc.
Select might not have the performance of the public network yet, but it is only a matter of time until it will even surpass it, as home users simply cannot compete with a billion dollar datacenter op.
I’m happy we have been a part of such successful startup and wish Storj the best, even if they will decide to go more enterprise grade path.

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It’s unfortunate, as we’ve all kinda been hoping to get a piece of that 10PB… but in the end Storj-the-company will still get paid for that space… so it’s still great to land that new customer!

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That’s certainly unfortunate for us SNOs on the public network. But it’s a lot better than them seeking a solution elsewhere. I don’t think most of us are in it for the short term win and I’ll take the further exposure for Storj as a long term good that could benefit us too. Thanks for being transparent about this and letting us know.

It’s tough when laws and certifications are built for an old paradigm. Hopefully you can make some progress on getting the public network certified in some way. And yeah, as mentioned by others, I hope the performance characteristics of Select will still work for them.

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It’s honestly disappointing to hear that such a large customer, who could have significantly contributed to the public network’s growth, waited until the last minute to consider SOC 2 compliance. It’s frustrating because this is something that should have been on their radar from the beginning, especially given the scale of their operations. Now, because of this last-minute oversight, the public network misses out on a valuable opportunity. Why wasn’t this planned for earlier to avoid such an outcome?

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As a an SNO this is disappointing news to me, and I’m not entirely sure it’s good for Storj.

For what incentive will primarily US customers on-board data to Public when Select exists? I’m also assuming at some point Select will also have some satellite for EU.

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The timeline was a bit strange. They signed the paper work before asking their security team. The soc2 conversation was coming up just a few days ago :confused:

I don’t understand that statement. We have tested public network + surge nodes. So we already had test results and from there on it is just a math problem. How many surge nodes do we need to make this possible? Just that we can’t call them surge nodes anymore.

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That sounds like some clients I’ve worked with!

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Thank you for your transparency, despite this being very disappointing news for us SNOs.

I guess, on the plus side, we are in the same place we were 6 months ago. So at least no worse off. Just dashed hopes.

That gold mine is just around the corner :wink:

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Storj select has some other drawbacks. In the last few days we basically jump back and forth between picking RS numbers that would give us high durability but it also gets more expensive. Or we reduce durability (should still be better than other cloud providers) and make it cheap. There is no middle ground. Customers that want to have the cheapest option and the highest durability should pick the public network.

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For the same parameters as Public does Select cost more $/TB in both storage and egress? Or is this a non-sensical question?

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As far as I understand this deal will also force us to get soc2 certified. It will take time but if we are lucky the outcome is that we can say one day that the entire public network is soc2 compliant and this hole problem goes away. So there is hope.

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This would be amazing, but it’s not going to be an easy one to achieve.
Godspeed, guys! :smiley:

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If the entire network is SOC2 certified, what would happen to the current selected node program, are they getting deprecated…?

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Storj can SOC2 themselves… but not the public network. Because clients ultimately connect to nodes directly… at which point Storj doesn’t control the compliance procedures of those nodes.

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and are You prepared for Select partner’s datacenter to get burned? like famous OVH’s one?
or just withdraw from the deal and just delete all the data?
Will repair process handle it? vs single “Public network” nodes?
where repair is easy for the network,
and select hasn’t got that ip 24 rule, so i don’t know how it safer than Public in such case.

Imagine Loading tens of PB on such faulty partner, and having to repair that right away?
I am very curious if you would manage. Or anyone would, and any cert. SOC2 wont help here. Maybe Storj need its own cert. like “StorjSoc2” a cert. for SOC2 compatible, meaning the Storj public network is even betterly secured by design, and protocol, than any SOC2 can assure. Storj, a Class of its own. A laugther no more. Just imagine there is Bitcoin and Bitcoin “Select”, govermently certified… it loses all of its meaning then. Should be no divide in Storj, one network to rule them all…

In Public network, nodes could also choose preferences, plans.
If either they want 5$ for storage and 1$ for egress, or 4$ storage and 2 for egress and so on…

The big customer here choose Storj because its the hardest, dirties job for disks, to perpetually store backups from the M$ customers, or other top cloud, that no one wants to do, and Storj appears to be a magic solution, “the performance, the price, Brilliant! Lets go with that, Boss!” - they might think

The problem is the same host centers that ask 2 times more $ for the job, now agress to do it for 2 time less with STORJ, because they have emtpy disks,

You think its long for them to realize that it not nessesary calculates for them if it grows big enough to saturate them? and they realize the HDDs are dying more than it is worth it?
Im curious.
With public You have people that don’t know yet what they are signing for, with such model, and potentially, constant inflow of them. Easy to replace, easy to repair, Wonder how it looks with Select nodes… my 2 cents as some here says.

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The answer isn’t as simple as you might think. A storj select node usually has higher storage costs and we have to pay for allocated space even if the customer doesn’t use it. On the other hand you can get servers with free egress. Storj select is more individual pricing depending on the usecase. I don’t know the actual pricing but I was told storj select is a bit more expensive than the public network. Throughout multiple conversations with some of the stakeholders I got the impression that they know all this and can run the numbers way better than me. So I do believe the general statement that it is more expensive is correct.

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Not a single storj select customer does that. They all connect via edge services and so we can ask the question if it matter where the encrypted data is stored as long as we can garantee that the encryption key doesn’t leave soc2 world.

I am not a soc2 expert. It might be a bit too early for these conversations.

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