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Scoop: GoDaddy quietly kills its cloud computing business

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Perhaps web-hosting giant GoDaddy wasn’t cut out to be a cloud computing provider after all. According to an internal email shared with me by an anonymous ex-employee, the company has decided to shutter its Cloud Servers product offering after less than a year.

The email highlights GoDaddy’s focus on winning small business customers and the apparent ill fit of Cloud Servers for that goal. “After reviewing all of our hosting products, we decided to double-down on our shared hosting and site builder products and invest to win in these spaces,” it reads. “As part of this focus, we will discontinue Cloud Servers as a stand-alone product.”

GoDaddy has confirmed the decision in an email to me via a statement from CIO Auguste Goldman:

¬†“We are focused on SMBs and SMBs don’t use this product the way we are offering it now. So, in the weeks ahead, it won’t be a stand-alone product in and of itself. However, we plan to continue developing cloud technology into our other hosted products.
“We will continue to support existing Cloud Server¬†customers in a variety of ways.”
Already, GoDaddy has removed the Cloud Servers page from its web site site, and the offering’s old URL redirects to the GoDaddy home page. GoDaddy launched Cloud Servers in May 2012, after GigaOM broke news of its impending cloud computing offering in June 2011.

This type of decision is one of the classic risks of cloud computing, where a service might be here today and gone tomorrow. Services rarely shut down immediately, thus leaving users without a chance to reclaim their data or code and move it elsewhere (well, except in the case of MegaUpload), but an eventual transition to a new service is still necessary nonetheless. Recent examples of cloud services shutting down include Motorola’s ZumoDrive cloud-storage service, the Slicehost on-demand servers service (by Rackspace (s rax)) and, nearly, TextDrive (by Joyent), which was saved at the last minute.

The GoDaddy email mirrors Goldman’s statement on this issues, saying the company is “identifying the best ways to support customers who need to transition from Cloud Servers. Once we identify these support paths, we’ll notify them of the product update.”

Feature image courtesy of Shutterstock user Lucie Lang.

15 Responses to “Scoop: GoDaddy quietly kills its cloud computing business”

  1. I Work There

    I work for Go Daddy and I say STAY AWAY. Last year they told us that 2012 would be the Year Of The Cloud, we’d overtake Rackspace, we’d build it into an Amazon A9, yadda yadda yadda. HA! We put blood sweat and tears to get cloud service out the door. If you knew how we cut corners to meet the deadline you never would’ve signed up. There’s a reason our stuff is so cheap and now you know why.

  2. Just Christine

    As a Small Business Owner using GoDaddy for our SaaS product, we are given basically one week to find a new Provider and swap all our customers over. This will result in some downtime, a lot of IT time, Development time and QA time to test everything. What a way to come back from vacation. This is not at all pleasing.

    • Christine Sheppard

      It is sudden, and potentially devastating for small business. I would suggest looking to a provider with sole focus on premier Cloud/dedicated hosting. You will feel secure with an expert support team helping to make a smooth transition without disruption to workflow/performance. I would strongly encourage all ex-Godaddy Cloud users to check out the great service at

  3. I purchased a year of the cloud servers service up front from GoDaddy and was sorry I did so. Their features were right, the plan and pricing was right, but they did a terrible job of managing the service. My VMs suffered from performance issues of, what I can only assume, were neighboring hosts.

  4. I don’t think that individuals or small business owners can understand exactly what cloud hosting is and in addition they may could not understand how many resources they need / consume. So, what I may assumme is that there may be a lot more complains than they thought about extra charges.

    Also, the only one that can “count” the resources used is godaddy. How can anyone now if the resources where actually used or if there were indeed overcharges?

  5. This is an example of a “me too” product offered by a company with no experience or respect in the market cloud compute services are pitched to i.e. engineers, developers, sysadmins. When selecting a vendor you need to think about the reputation the company behind it has and how involved they are with the community. GoDaddy are essentially a consumer hosting company and consumers (personal websites, small non-tech businesses) don’t know/care what cloud is; they just want a website.

  6. GoDaddy has carved out a market niche for themselves around being a low cost datacenter. That serves a specific market need but does not solve the problems of the enterprise player. Companies like Cbeyond and other managed services players are focused on providing a more enterprise grade solution, there is plenty of business for all and I expect to see more market segmentation in cloud over teh next few years.

  7. its a scoop when a public company makes a public change to their public website that features their entire product line? “Scoop: McRib once again off the menu”

  8. Brad Nickel

    This is disappointing, because it’s a perfect product for the mid market, not large and not small. What was missing was admin assistance. We have 3 accounts for clients and it performs well and is easy to understand and use. I think they are making a serious mistake in not riding this out, because there is a market for this.