Cloud backup is exactly what it sounds like. Your data is stored in an online repository, where it’s accessible to you when you need it. It works like this: You download a desktop client to your PC, select the folders you want to back up, and that data uploads to the service on a set schedule. Then if catastrophe strikes, such as a house fire or robbery, you have a clean, up-to-date copy of your data stashed on a server somewhere, all safe and sound.
Cloud backup does not eliminate the need for a local backup on an external hard drive of some sort, but it provides an easy solution for keeping another backup off-site. Your other options are to circulate a few hard drives that you keep in a safe at the office (a pain to remember), or run a remote server (technically challenging). Pay a few bucks a year to store your hard drive data online with a third-party provider is the easiest choice for most people.
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