Online Backup Company Carbonite Loses Customers' Data, Blames And Sues Suppliers (Updated)

The danger of storing your data in the cloud, part n. VC-backed online backup and storage provider Carbonite has lost data of 7,500+ customers who relied on the company to keep their files safe, The Boston Globe unveiled over the weekend.

(note: see updates below, at this point we can’t be sure anymore if any data was actually lost or not)

The newspaper gets the information from a lawsuit that was filed by the Boston company last week, alleging that two of its service providers sold it over $3 million worth of defective hardware, linking this to the loss of their customer’s data and as a result, bringing “substantial damage” to its business and reputation.

Carbonite is seeking unspecified damages against Promise Technology, which it is suing for unfair and deceptive business practices, fraud and breach of contract, as well as system integrator and IT consultancy firm Interactive Digital Systems (for breach of warranty). The latter company advised and implemented Promise Technology solutions, which were supposed to monitor multiple computer hard drives in order to assure that they were functioning properly.

I think it would be too easy to point to Carbonite for the loss of data if in fact there were serious errors with the software that were unable to be fixed by Promise engineers – something an executive at Promise Technology categorically denies – but the real victims of course are the customers, who will most likely think twice before trusting a cloud-based storage and backup provider with their files from this point forward. I also think it’s worth pointing out Carbonite has been caught red-handed earlier this year astroturfing Amazon reviews, as reported by David Pogue of The New York Times.

Update: Carbonite CEO David Friend weighs in:

“The failures of the Promise equipment occurred primarily during 2007. We stopped buying the Promise servers and switched suppliers. We allege that the Promise servers had defective firmware and were not reliable enough for Carbonite’s use. We are demanding that Promise compensate us for the cost of replacing their defective products. As for the 7,500 affected customers, their backups were restarted automatically and immediately on our new servers.”

Update 2: Friend checked in again to state that no data was lost in the event, but a commentor says otherwise (anyone else affected who would like to weigh in?):

“I actually am one of those customers and I truly lost data (I had a hard drive lock up right when this happened). It was backing up my personal home PC and I lost over a year’s worth of pictures. The CEO called me personally, and they gave me free service for awhile, but I definitely have multiple layers of backup now.”

This isn’t the first data loss horror story we’ve covered here, and it won’t be the last either.

On a sidenote, I’d change my homepage a bit for a while until things cool down if I were Carbonite.

(Via Cloud Computing Journal, hat tip to Marco Trombetti)