Blame me: Mozy scraps unlimited backups
Mozy, the online backup service provider and EMC subsidiary, plans to announce today that it's dumping its subscription permitting customers to store unlimited data. — The reason is not hard to guess: with ever-growing quantities of photos and videos …
Context & Ripple Effects
Mozy's move closes a chapter that opened in September 2007, when TechCrunch reported EMC had picked up the Utah backup startup for a reported $76 million. At the time, unlimited storage was the hook that separated consumer online backup from external drives — a promise EMC inherited and kept running for over three years.
The stated trigger is arithmetic, not strategy drift: customer photo and video libraries keep growing while the flat fee stays fixed, so heavy users subsidize nobody. Killing the unlimited tier turns Mozy's worst-cost customers into priced ones, and it does so under an acquirer whose storage economics — from the VMax array work in 2009 onward — are built around selling capacity, not giving it away.
First-order effects
- Existing Mozy subscribers on the unlimited plan lose their flat-rate guarantee and must either accept a capacity-capped tier, pay more as their libraries grow, or migrate to another service.
- For EMC, the change converts an open-ended storage liability inside its $76 million acquisition into predictable, per-terabyte-backed revenue.
Second-order effects
- Rival consumer backup services now face a choice: hold their own unlimited promises and absorb rising per-user storage costs, or follow Mozy and risk churn from customers shopping on price alone.
- Competitors' marketing gains a wedge — 'we still offer unlimited' becomes a differentiator until their own cost curves force the same retreat.
Third-order effects
- If the pattern holds, 'unlimited' consumer cloud storage proves structurally unsustainable wherever average library size compounds faster than subscription prices, pushing the whole category toward metered, capacity-tiered pricing and making the original flat-rate promise a temporary customer-acquisition subsidy rather than a business model.
The trend: Consumer cloud storage is steadily abandoning all-you-can-store flat rates in favor of capacity-metered subscriptions as user data outgrows what a fixed fee can cover.