No matter whether Symantec is withdrawing or being chased, it's exiting the cloud backup market beginning in January 2014.
In the early hours of last Thursday, Symantec started informing distributors and resellers that it would discontinue Backup Exec.cloud, the cloud-based version of its popular SMB backup product, effective 6 January 2014. Customers can use the service for another year, but support will completely cease at the end of 2014.
"As we align with our new offering strategy and efforts to streamline our product range to provide fewer, more integrated solutions for our customers, Symantec has made the decision to retire Backup Exec.cloud," Symantec wrote in a statement to CRN partner publication Channelnomics.
"Existing customers will have use of the service until the end of their annual service period. We are firmly committed to doing everything we can to help our partners and customers successfully navigate this process."
The discontinuation of Backup Exec.cloud comes as the market continues to migrate toward cloud-based backup services over conventional on-premise hardware and software solutions. According to a recent study conducted by backup vendor Intronis and The 2112 Group, more than one half of solution providers offer some form of cloud-based backup solution and more than three-quarters earn up 20 percent of their revenue and profit through backup services.
"Data loss happens every day and can come in all forms, from hardware failures to user error and natural disasters. SMBs and IT service providers should think of cloud BDR services as insurance for the company's data - no business should be without it," said Neal Bradbury, vice president of channel development for Intronis.
Symantec continues to dominate the backup software market with its Backup Exec and NetBackup products. However, Symantec has been under pressure from next-generation backup service providers who are nibbling away at its market share with low-cost and scalable cloud products.
"The fact that Symantec is shutting down its cloud storage offering points to how difficult it is for companies relying on legacy technology to fully grasp the changes that cloud computing is bringing to the enterprise. Companies serious about disaster recovery and business continuity require more than simple file storage in the cloud, they need a way to recover their applications and ideally to continue working at all times, even in the face of a disaster," said Justin Moore, CEO and founder of cloud backup vendor Axcient.
The holiday timing of the announcement was not lost on competitors. Already Zetta.net, a cloud-backup service, is offering contract buyout and mitigation support to Symantec Backup Exec.cloud customers.
"Symantec Backup Exec and Backup Exec.Cloud customers have endured one jarring surprise after another," said Gary Sevounts, vice president of marketing at Zetta.net.
"First Backup Exec 2012 was released to universally negative reviews, then patches were released that didn't provide support for mainstream platforms like Windows Server 2012, and now the cloud backup component is being shut down. Stability is a fundamental pillar of enterprise backup, and it is critical for backup vendors to give business customers confidence their critical backup data will be available for recovery."
Zetta.net is likely the first of many displacement initiatives. When Zenith Infotech, a one-time leader in managed backup services, fell into its debt default, competitors such as eFolder, Datto and Axcient pressed conversion programmes to capture partners and customers.
The larger questions are what Symantec's withdrawal from the cloud backup market means for its other services and what this means for the greater cloud backup segment.
First, the Symantec question. For nearly a year, CEO Steve Bennett has been labouring to transform Symantec from a low-growth behemoth to a nimble, profitable and growing company. Under the Symantec 4.0 initiative, Bennett has overseen layoffs and reorganisation as Symantec works to trim itself to a more agile organisation.
Symantec 4.0 hasn't overlooked its channel. The security and storage software specialist is trying to core down its primary partners, believing going to market with fewer, more focused solution providers will result in better returns. It's doing this at the same time as competitors, most notably McAfee, continues to attack its channel with well-supported partners.
Working against Symantec is continued declines in PC sales. Many of Symantec's security and storage products are tied directly to the PC paradigm. More than 40 per cent of Symantec's revenue comes from endpoint SMB and consumer security products; the PC decline is dragging performing, as noted in Symantec's most recent disappointing quarterly report, in which revenue and profits shrunk.
The demise of Backup Exec.cloud could also spell bad news for Symantec's other cloud services, Symantec Endpoint Protection Small Business Edition 2013 and Enterprise Vault.cloud. If cloud backup, a noted bestseller among solution providers, isn't producing results for Symantec, it's hard to believe the other services are faring much better.
Symantec is giving few clues of its products' future, saying that it will continue investments in existing and legacy products.
"Symantec will continue to invest in its core backup and recovery offerings, including on-premise Symantec Backup Exec and NetBackup software and appliances, as well as innovative cloud-based storage, sharing and synchronisation platforms," Symantec said in a statement.
What does all this mean for the greater cloud backup segment? Chances are the demise of the Symantec service had more to do with conflicting internal priorities between its conventional software and cloud products. However, competition among other cloud backup vendors is fierce. More than four dozen companies offer cloud-backup solutions.
And despite some of the marquee names, including Carbonite, NetApp, EMC and Mozy, none can claim market leadership or first-mover advantage.
Symantec is likely not indicative of a broader shakeout in the cloud backup market. That said, signs are pointing to a period of consolidation in the crowded backup segment.
Larry Walsh is chief executive and president of Channelnomics
As part of our special editorial relationship, CRN is republishing this article from Channelnomics
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