Lessons Learned from the Nirvanix Bankruptcy

Imagine your client lists, templates and entire database lost in one fell swoop. This fear is the exact reason IT managers and CIOs outsource data storage to the cloud.

Yet that decision backfired on customers of a hosting service called Nirvanix in September of this year. With only a month’s notice, clients were told that the business was going under and were left on a nail-biting scramble to recover or move their data. Although some see this as evidence of cloud computing’s lack of reliability, this failure doesn’t reflect the future of cloud storage; big-name providers are unlikely to go under any time soon, but this Nirvanix bankruptcy indicates certain flaws clients should be aware of when choosing a vendor.

Choose Carefully

First, it’s important to do due diligence before selecting a hosting provider. Although no one could have foreseen what happened at Nirvanix, choosing an established company with a respectable client list increases the chances that valuable data will be safe in their hands. Furthermore, the IT department must read the contract carefully. Provisions for data loss or even a shutdown mean that the vendor is likely to have a plan in place and understand the importance of giving clients adequate time to make arrangements.

Don’t Get Tied Down

Because no vendor is bulletproof, the best strategy is to avoid vendor lock-in, no matter which provider has won the contract. To avoid any sudden halts in business activity, if anything happens to the data host, many CIOs are beginning to plan for at least a partial back-up. Cloud applications that are loosely coupled, service oriented, and up to Web and marketplace standards are the most likely to bounce back from these kinds of problems.

Have a Backup Plan

A cloud exit strategy, like a fire escape plan, should not be neglected. By planning for the worst-case scenario, a smart business can stay ahead of the curve and avoid unnecessary stress in the future. A plan for migration doesn’t indicate distrust or doubts for the host provider; rather, it proves that the IT staff are savvy enough to have a plan for any situation. The key is to make risk mitigation a priority by having a plan in place for where data can be kept. Even a file on hand tracking the amount and type of data stored, along with the contact information for a backup provider, can have a significant impact.

After the Nirvanix hailstorm, it’s unlikely that anyone will find themselves faced with a “two weeks to leave” dilemma anytime soon. But it’s just as certain that prices and needs will change, upper management will hire new faces, teams will need more support and customers will just change their minds. Being totally dependent on a cloud storage provider without any company backup strategies in place in case something unforeseen occurs is as risky as it is naive. Choosing a trustworthy cloud storage vendor, keeping abreast of trends and the company’s needs and having a plan for migration will help prevent your business from being vulnerable to a provider’s unreliability.