Becoming a REIT would also require that Iron Mountain distribute 90 percent of its profits to its shareholders, which would be good for the hedge fund guys looking to generate as much income, and as many fees, as possible. However, this will leave Iron Mountain without enough cash to replace the warehouse business as enterprises shift away from archiving records in boxes to some sort of electronic vaulting. A week after it killed off the cloud storage business, Iron Mountain also sacked the CEO and brought back the last guy, whom we can assume knows more about managing warehouses full of boxes.
Note that Iron Mountain isn't getting out of the IT services business. Connected Backup, LiveVault, Mimosa and the value-add--and therefore more profitable--archiving solutions aren't being killed off, just the commodity cloud storage.
In a more common occurrence, cloud storage gateway startup Cirtas let a substantial portion of its staff go and suspended its sales and marketing efforts. Apparently, while Cirtas' Bluejet iSCSI-to-cloud gateways could manage a good demo, they weren't really ready for prime time. Management believes the market will be more receptive to a revamped product and wants to preserve what's left of the $22 million they raised earlier this year so they can revise the product and try again.
Iron Mountain is out of the basic cloud for business; Cirtas left because the product just needed work. That still leaves Amazon, Nirvanix and a raft of ISPs and hosting companies offering cloud storage, and Nasuni, TwinStrata and StorSimple with gateways. Looks like the cloud isn't falling, but these exits reinforce my opinion that IT folks need to plan their cloud adventures carefully. After all, sometimes clouds bring rain.
