Back in April of last year HP decided to reinvent the online storage wheel by introducing their own backup service, named HP Upline. It came. It never quite got off the ground. And now, it’s officially joining the deadpool.

Just in case there is anyone out there who actually put data on Upline and didn’t get the email from HP announcing its departure, it says in part:

HP continually evaluates product lines and has decided to discontinue the HP Upline service on March 31, 2009.

HP will no longer be backing up your files to the HP Upline servers as of Feb 26, 2009 at 8 am Pacific time. HP will keep the file restore feature of the Upline service operational through March 31, 2009 Pacific time in order for you to download any files you have backed up to Upline.

If you have a paid subscription to HP Upline, you will be refunded the full amount of the fees you paid for the service. That refund will be credited to the credit card account or PayPal account that you used to subscribe to the Upline service. If you do not receive the refund prior to March 31, 2009, please contact our customer service team at http://www.upline.com/support/email.aspx.

HP looks forward to offering you additional technology products and services in the future.

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This morning, those of us still using a GrandCentral number are logging in to our accounts to see this:

An expired SSL certificate is not a big deal. Just accept the expired certificate because you trust the site and move on. But that’s not the point. It’s yet more evidence that if the GrandCentral folks are still at Google, they’re working on something else. The GrandCentral support forum is filled with questions and problems, and there has been no official answer to anything.

The challenge for those of us left behind is number portability, or lack thereof. I like my GrandCentral number. It’s easy to remember. It’s in the area code I want it to be. I would gladly use another reasonably-priced service if I could take the number with me (I do use PhoneFusion for my local contacts). Yes, GrandCentral has always been “beta” and was never meant to be used for mission-critical contacts. But it’s a little difficult to “test” a service like GrandCentral without giving the number out to contacts, isn’t it?

It’s about time for Google to do the right thing. Shut GrandCentral down once and for all, and give us a way to port our numbers elsewhere.

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While just a few data points don’t make up a trend, it does seem likely that we haven’t seen the last closures. Services start up in a burst of optimism, then hit the cold hard wall of needing to pay for servers and bandwidth. The tightening of venture capital and the decline of online advertising have been covered elsewhere: other factors that will make it tough for free eternal-beta Web 2.0 startups to stay in business. But how is the savvy web worker to cope?

It’s clear that “free” doesn’t actually mean “free” when you put it into a larger context of web work. Choosing to use an online service for part of your business workflow carries with it opportunity costs and risk costs. Rather than rushing to put your entire business online, consider these guidelines:

1. Prefer in-house servers for mission-critical applications. Yes, it’s nice to be able to sit down in a cybercafe with instant access to all of your work – until the day when some of it is just missing in action thanks to factors beyond your control. As a software developer, for example, I’m not willing to place client code on a free source control server in the cloud, even though there are several excellent ones out there. Instead, I run my own server, and can access it remotely if I need to. There are tradeoffs, of course, but for this particular data I am willing to assume the administrative costs to eliminate the dangers of free.

2. Prefer portable data. If you do have data that you’re willing to host with a free service, then one of the best things you can do is ensure that you’re not locked in to that particular service in case things change. This implies that you should have easy access to all of your data in some standard format (XML or CSV, for example) in case you ever want to pick up and leave. Beware of services that have no export capabilities or that only let you save data in their own proprietary formats.

3. Prefer backed-up services. All the data portability in the world does you no good if you don’t have the data when you need it. I Want Sandy and Stikkit are doing the right thing and giving a few weeks of warning, but what if you end up on a service that shuts down overnight? We’ve mainly been concerned with backing up desktops into the cloud over the past few years, but I’m increasingly convinced that backing up the cloud to local storage is the sensible thing to do. I expect this to become a key differentiator in the next round of services.

In the current software and economic environment, I’m re-evaluating my dependence on free services, and pulling some things back to less trendy but more reliable client-side applications. How about you?

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This isn’t your typical “startup ran out of money” story. Rael Dornfest, the brains behind Values of n, accepted a fulltime job with Twitter. Rather than pass the web apps on to someone else or keep them going under Twitter’s roof, the services will just go away, leaving their user base high and dry.

While I’m happy for Mr. Dornfest and I’m looking forward to seeing how Twitter improves with the infusion of his technology and expertise, this should serve as another wake-up call to all who rely on free services by small companies. Often labors of love built during off hours, there’s nothing to stop developers from moving in other directions on short notice.

Did you use I Want Sandy or Stikkit? How will you replace these services in your life? Read further analysis on GigaOm.

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