It’s Official, The Nirvanix Cloud Storage Service Is Shutting Down

It’s official, Nirvanix is shutting down its business. The cloud storage company has scrapped its website, leaving a statement and how to get in touch with customer support.

The statement says customers need to actively participate in getting their data off the Nirvanix infrastructure. The company will also put its resources behind helping customers move their data to different services.

According to the statement, the company says it has an IBM team ready to help customers. It also states that it will provide higher speed connection with some companies to increase the rate of data transfer from Nirvanix to their servers.

For the past 10 days Nirvanix executives have kept mum about the future of the company after a leaked email to customers on September 17 explained that it would begin an immediate “wind-down” of the storage service by October 15.

Since then, company executives have been silent, not exactly stirring confidence in how it is perceived in the market.

But Nirvanix’s problems did not start 10 days ago. In March the company hired Zynga CIO Debra Chrapaty. She was the sixth CEO hired by Nirvanix in the past five years, signaling deep management issues with the company. The constant change in management had to affect the company, which never really went beyond serving as a pure cloud storage company.

By trying to play in the pure storage business, Nirvanix found itself in a market that, over the past five years, became increasingly commoditized by Amazon Web Services, Windows Azure and now Google Compute Engine, which have all been engaging in a price war. With no service to offer on top of its storage, Nirvanix did not stand a great chance of differentiating from such large competitors.

Those left standing have been cloud services brokers like Oxygen Cloud, which spent most of last weekend preparing its infrastructure to help its customers move off the Nirvanix infrastructure. Oxygen provides a cloud drive, which acts as a virtual hub that companies can use to connect other services.

Nirvanix’s demise shows how the cloud market has matured over the past few years. It is now dominated at the infrastructure layer by a few large companies that can compete on price for commodity offerings such as storage. The real differentiation will be SaaS and other services such as Oxygen that serve as a way to make personal files available in the data center but with the full flexibility that cloud services offer.

(Feature image courtesy of Tom Haymes)