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When The Backup Needs A Backup

Many owners of Sidekick phones recently found that their personal information, including contact numbers, pictures, notes and to-do lists, had vanished.

When the phones were introduced, they were marketed as being safer than competing products because data was stored at a central server facility rather than solely on the individual phones. That meant Sidekick users whose phones were lost, stolen, or thrown into fires by former lovers could simply have their information loaded onto new phones.

Then, a few weeks ago, things went bad at the server farm. Service was intermittent. Microsoft, which makes the phones (through a subsidiary aptly named Danger), and T-Mobile, which provides services for them, advised customers to avoid restarting their phones, removing the batteries or letting the batteries run down.

But even some of those who complied with the instructions lost their information. One now-former Sidekick user, Mary Boyle, of Silver Spring, Md., referred to the episode as “a terrible experience.”

T-Mobile has already given customers a $20 refund to cover the cost of one month of data usage on the phone. It also will give an additional $100 credit to those who experienced “significant and permanent” loss of personal data. But, for those like Ms. Boyle, who lost more than 500 contacts, 100 pictures, a to-do list and dozens of Web site passwords, that is pretty paltry sum.

The incident reminds us that every method of data storage has its pitfalls. Most of us do a terrible job of protecting our own data, making it tempting to rely on professionally managed servers that are regularly maintained, monitored and backed up. But, once we let our data out of our possession, we lose control over it.

The issue comes up in many situations. Intuit offers online versions of its Quickbooks accounting and TurboTax tax preparation software. Intuit will maintain users’ data and allow them to access it from any web-enabled computer. It is quite convenient. But those users who rely exclusively on Intuit to store and protect their data may have little recourse if, for example, Intuit decides that it will not store data beyond a certain length of time, or that it will not store it for users who choose not to maintain or update subscriptions to Intuit products. (Intuit does allow users to store their own copy of their data, which is a wise thing to do.)

I recently had reason to be thankful for the fact that all of my firm’s data is under our own control. A client needed a copy of his 1991 tax return. I had the original data file for that return. The file was unreadable by modern software, but I was able to dig out the old floppy disks from the 1991 tax prep program. I reinstalled the software, and a few minutes later I had a printout of that client's return. Had I used an on-line service back in the early '90s, there is little chance that I would still have had the data or the means to recover it.

The best option is to back up your data in as many ways as you can. Remote data can be lost in server crashes, local data in hard-drive failures, and paper copies in floods or other natural disasters. No single method, by itself, is sufficient.

Newer phones, like the iPhone, are designed to back up a user’s data when the device is connected to a computer, protecting customers from the kind of data loss that Sidekick users experienced. Of course, to be protected, you need to regularly connect your phone to your computer. Every backup system requires some sort of discipline.

And there’s the rub. Most of us are not very diligent about backups. We all have important things to do, and backing up our digital lives is just not very important — until that moment when, suddenly, it is. Often, that realization comes too late to help us.

So Sidekick users who took comfort in the knowledge that backups happened automatically got a rude surprise this month. The system had an Achilles’ heel, leaving users in search of a backup for the backup.

Larry M. Elkin is the founder and president of Palisades Hudson, and is based out of Palisades Hudson’s Fort Lauderdale, Florida headquarters. He wrote several of the chapters in the firm’s most recent book, The High Achiever’s Guide To Wealth. His contributions include Chapter 1, “Anyone Can Achieve Wealth,” and Chapter 19, “Assisting Aging Parents.” Larry was also among the authors of the firm’s previous book, Looking Ahead: Life, Family, Wealth and Business After 55.

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