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Don't live in fear of your cloud storage provider going under

Sharon Florentine | Oct. 4, 2013
The closure of cloud storage provider Nirvanix sent a chill through the cloud storage industry and its customers, but is it really a big deal?

"It's been a mantra for years — back up your data. Have a solid, tested, dependable backup and recovery plan. Make sure you have the bandwidth to quickly move your data, and perform regular migration assessments to make sure that if something like this happens again, that you'll be able to handle it quickly," he says.

Assessing Future Impact
While the immediate impact on the cloud storage industry might be chilling, those most drastically affected will be managed service providers and white-label resellers who brought in Nirvanix as a cloud storage option for their customers, according to the 451 Research report.

Those taking the biggest hit to their reputations will be "multi-tenant data center providers, IT services providers and resellers. In many cases, these providers have brought in a service like Nirvanix and white-labeled it or offered SLAs on top of the service. They will take blame for lost data or the sudden disruption and expense in moving data and they will suffer for having chosen an unreliable partner in Nirvanix," according to the report.

But in the long term, the economic draw of the cloud should overcome the fear and hesitancy of many businesses considering cloud storage solutions, says Vekiarides, and the closure will also drive businesses toward larger, better-known cloud storage brands instead of to smaller, newer providers.

"The storage needs of businesses haven't gone away. Organizations' data storage requirements still are growing at 40 percent to 60 percent a year," he says. "What will change is how CIOs shop for and deploy cloud services, in that everyone still wants choice, but they'll be much more wary. There's always the need for choice among a number of vendors, and CIOs will want the best of breed. That might mean they will gravitate toward more established vendors," he says.

The 451 Research report backs up this assertion, stating that customers "burned by this are going to be far less willing to experiment with a smaller vendor or a startup service provider. Instead, they will turn to traditional vendors or larger vendors even if there's better technology available."

And Nirvanix customers aren't limited in their choice of a new provider to host their newly homeless data, says the report. "Competitors like [Vekiarides'] TwinStrata, Egnyte, Global Net Access (GNAX), Savvis and others are scrambling to nab Nirvanix customers," and there are many more options within the storage services market, including the Go Daddy Group, Mozy, Barracuda Networks, Comodo Group, Box, Dropbox, Google, Microsoft and others, the report says.

"Nirvanix didn't have any capabilities that others can't essentially match...the appetite for external resources is far larger than the amount of disgruntled Nirvanix customers will be," according to the report.


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