Failing Nirvanix Warns Cloud Storage Customers: Move It or Lose It

Nirvanix is shutting down its cloud servicesPartners of enterprise cloud storage specialist Nirvanix Inc. are scrambling to find a home for their clients’ data after the San Diego, Calif., company said Monday it was shutting down at the end of the month.

It’s a nightmare scenario for users and resellers of the cloud service — they have less than two weeks to find alternate storage space and relocate existing data to new servers.

According to a report in Information Age, Nirvanix officials notified employees and key partners late Monday that the company was shutting down. Nirvanix did not respond to requests for comment from Channelnomics.

According to published reports, Nirvanix partners were told the cloud provider had failed to secure additional funding and could no longer withstand withering price cuts and stiff competition from major players like Microsoft Corp., Google Inc. and Inc.

“It’s crazy. This wasn’t a two-man-and-a-dog outfit,” Chris Pyle, CEO of Nirvanix partner Champion Solutions Group in Boca Raton, Fla. told theWall Street Journal.

Steven Ampleford, CEO of UK-based Aorta Cloud, told the WSJ he got a call from Nirvanix executives Monday saying, “Armageddon is about to happen.” He was not told what would happen if customers don’t move their data out by Sept. 30, he added.

Founded in 2007, Nirvanix quickly made a name for itself in the crowded enterprise cloud storage space, earning the business of major corporations like Fox News and National Geographic. In 2011, Nirvanix was tapped to provide storage services as part of part of IBM Corp.’s SmartCloud Enterprise services.

Its fortunes waned recently, however, when major vendors began discounting similar services. IBM spent $2 billion to acquire hosted infrastructure and cloud-based managed services provider SoftLayer Technologies Inc., obviating the need for much of Nirvanix’s technology.

Ampleford told Information Age that Nirvanix might still be salvageable, and that he believes the company’s proprietary technology is valuable.

“The patents it has around managing petabytes of data in the cloud are unique,” he said.