Carbonite Loses Customer Data
Carbonite is a online backup company that is VC-Backed. This was released while I was out of the country – but I had to post this story. Carbonite with its major funding and large marketing campains loses data for 7,500+ customers. Although Mozy (purchased then spun-out by EMC as Decho Corp) has a competitive product, Carbonite is the one that is pushing with full force in marketing. Here is the article where I found the story at the Boston Globe:
Carbonite’s complaint charged Promise Technology with breach of contract, fraud, and unfair and deceptive acts and practices. The complaint charged Interactive Digital Systems with breach of warranty. It seeks unspecified damages against the two companies.
Promise’s hardware was meant to monitor multiple computer hard drives to assure that they were functioning properly to preserve customers’ data, according to the suit. Instead, the suit charged, “Carbonite lost the backups of over 7,500 customers in a number of separate incidents, causing serious damage to Carbonite’s business and to its reputation as a reliable source for backup data service.”
The suit said Promise engineers were unable to fix the errors. “The problems that have occurred have required Carbonite’s senior engineers, senior management, and senior operations personnel to spend enormous amounts of time dealing with the problems,” it said.
For full disclosure, I work for a company that provides online backups called FirstBackup, and we have had some customers convert to us due to this problem. We are priced quite a bit higher than Carbonite’s $54.95/year for unlimited storage – but anything is higher than unlimited storage. To supply decent back end systems and attentive personal support – I can tell you $54.95/year does not pay the bills. We have used Promise in the past, and haven’t had any major problems, but enough little ones we did not continue our storage builds with them.
I get very worried when companies that are VC-backed offer products for almost nothing. It seems that they are just harvesting customers to be later sold to another company or given a price increase. Investors in venture capital firms are wanting a return on their investment.
I think Carbonite will weather this news, as it didn’t seem to get too much press for as much positive marketing that they are pushing out there. (Check out this article about how Carbonite’s VP of Marketing started posting fake reviews on Amazon for their product) I think the major loser in this mess will probably be Promise. Businesses in the backup business make sure to watch their market, and a vendor with major problems and possibly not standing behind their product is a major blow.

I exclusively buy my music on iTunes well before I even had an iPod. I love getting quality music very easily. When Apple started offering the “Plus” music that was DRM free with better quality – I knew it was just a matter of time while they tested the market with the new pricing when they would move all pricing to the “Plus”.
I haven’t had an iPhone too long yet, but was very excited to hear that there will be some new things already coming announced today. First, I love the numbers of the iPhone sold. The market was expecting 10Million, and Apple blew them away by selling 13.7Million in 2008. They next went to the AppStore where they bragged 25,000 Apps have already been approved, and that they approved 96% of all submissions from unpopular thought. Lastly for summary information, they have had 800Million downloads from their AppStore already. That’s quite impressive with about 50 downloads per phone with the numbers we have.
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