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The lesson of Carbonite

The lesson of Carbonite

Probably not a good idea to make decisions which could alter the course of company history on a Saturday night.

Will Carbonite become the next Sleep Train, and attempt to regain access to Limbaugh’s audience? Via Instapundit, Rush said no to Sleep Train and probably would to Carbonite:

OUCH:  Limbaugh Not So Hot To Get Faithless Advertisers Back:“The rift between Sleep Train Mattress Centers and Rush Limbaugh apparently became permanent today after Limbaugh reportedly turned aside the Sacramento retailer’s attempt at a truce.  Limbaugh rebuffed Sleep Train’s request that the controversial radio host resume his duties as a paid spokesman for the company.”

Ultimately, he’s got the audience.  And the audience isn’t happy with the advertisers who’ve left.  So now it’s Limbaugh who’s protecting his brand, since if he went back to endorsing them it would look like his endorsement was only about the money, which would devalue it.

The week in Carbonite:


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to the full extent allowed by law.


Knee-jerk reactions, and over-reactions, have consequences. I feel for the Sleep Train and Carbonite investors who are losing money hand over fist because of these moronic CEO’s. Rush’s audience is loyal to him, and he knows it. Sadly, “loyalty” is very much underrated these days.

The left don’t know anything about loyalty. They are gonna end up turning on eachother anyway.

Oh well, my mom always said “You lay down with dogs, you get up with fleas” 🙂

2nd Ammendment Mother | March 9, 2012 at 10:35 am

Obama is a poison pill for businesses.

It doesn’t pay to be a FOO(l)!
“Friend of Obama” (not sure how to work that “l” in?)

I was already displeased when NetFlix doubled their monthly fees, but when they were among those that dumped Limbaugh, I dropped them.

I refuse to give my money to leftist politically-motivated businesses, or those who are just too spineless to do anything other than capitulate to the regime.

    tsrblke in reply to Mr. Galt. | March 9, 2012 at 10:59 am

    Netflix is another example of one of those companies that never advertised on Rush in the first place, but libs are claiming as a “Win” because they said they wouldn’t in the future.
    And to be fair to Netflix, I wouldn’t advertise on Rush if I were them either. After all they’re a video company, their primary audience is people watching TVs and Movies, they’d be better off doing TV commercials (or buying some ad space in that “pre-movie preview” time at theaters.

Not only am I in support of Rush to NOT take these companies back, I think other talk show hosts should follow as well.

We have to stand up to the “left” otherwise nothing gets changed.

    gasper in reply to Scorpio51. | March 9, 2012 at 11:00 am

    Scorpio51: I think that’s an excellent idea. If Hannity, Savage, Ingraham, and others were to refuse advertising from the companies that dropped Rush, that would be a real blow to these companies and would really work against the left. They are in a position where they could find replacement advertising then release these others. Other advertisers may think twice before succumbing to the liberal letter-writing campaigns. This has the adverse effect of hurting the advertiser, not the former sponsor.

      Uncle Samuel in reply to gasper. | March 9, 2012 at 11:36 am

      It would be very wise of conservatives to screen their sponsors and have some protective clauses in their contracts to prevent such as has happened with Rush.

      vertical in reply to gasper. | March 10, 2012 at 11:12 am

      Interesting comment. I think that over time Hannity et al will not have to reject them. Most listeners to any conservative talk radio show are also Rush listeners, or at least Rush fans.

      Those advertisers who betrayed Rush and outed themselves as leftists will find they are wasting their $$ advertising on conservative shows, so they will end up having to go elsewhere.

This is nice to see. The left has always been very good at coordinating boycotts and the like. Attempts to do this on the right have mostly stumbled — herding cats.

AFAIK, there is no coordinated effort to boycott the companies that have dropped Rush, but listeners have nevertheless responded.

This is good news! The vote you cast with your dollars (and your feet) is often the most effective.

MaggotAtBroadAndWall | March 9, 2012 at 11:03 am

A look at Memeorandum suggests the hate filled left wing activists refuse to surrender. The Rush “story” should be dying down but they are determined to keep it alive to destroy Rush.

If this is “war”, then Media Matters is the Commanding General that needs to lose. I just don’t know how to defeat it or make it surrender. Maybe somebody with standing should file a lawsuit against them to challenge its tax exempt status? Start a letter writing campaign to it donors? (I think most are far left foundations, so that’s probably a losing battle). The Daily Caller investigative journalism doesn’t seemed to have bothered it at all.

Media Matters smells Limbaugh blood and they’re not going to stop. We need to figure out how to make Media Matters feel pain.

    Uncle Samuel in reply to MaggotAtBroadAndWall. | March 9, 2012 at 11:34 am

    Tell the truth? Their head guy is a drug-rehab habitue’, isn’t he? And a bit paranoid about security…feeling the victim, insecure, and/or threatened by both left and right. Leftists are often all of the above…lawlessness breeds chaos.

    It probably would be very difficult to take this organization out since George Soros money is behind it. He seems to have a never ending supply of the green, and spreads it around to plenty of places.

    I have no doubt that Rush is in the Media Matters cross-hairs. (I denounce myself for that reference.) However, they won’t win this one. MM has already been reported to the IRS with respect to their tax exempt status.

    Rush had to explain Open Line Friday today so that his millions of new listeners would understand what today was all about. He may have been blowing smoke (I don’t believe he was), but he does it with the best of them. He is a very crafty and shrewd businessman.

    AND…he’s got TWITCHY as an advertiser now. ;o)

Uncle Samuel | March 9, 2012 at 11:30 am

So, did you all read that Gloria Allred, champion of ‘sluts’ and other assorted women victims, has been beating her little tin drum trying to garner attention and possibly Fluke’s case against Rush, claiming he broke the ‘chastity’ clause/law?

Professor and other attorneys, exactly what is the ‘chastity’ clause or law?

Do you all think it applies here?

Midwest Rhino | March 9, 2012 at 12:42 pm

O’Reilly was trying to tie Fluke’s appearance to Obama. Anita Dunn (I think) was part of the group that was “running her”, as O’Reilly put it. He seemed to think there may be a constitutional issue there, though I’m not sure what he was thinking.

1) DOOMED: Carbonite was on track to become just another “spectacular dot-com flameout” long before its CEO played politics with Rush Limbaugh’s audience.

2) $100 MILLION LOSS: Carbonite’s “growth” has been cancerous, showing accelerating losses – a whopping $100.4 million since 2007:
-$11 -$18 -$19 -$26 -$24 = -$100 MILLION

3) HAIL MARY IPO: Because of its heavy advertising, Carbonite was able to squeak out a weak, desperation public offering in mid-2011 — which is why today it has $60 million of investors’ cash in the bank, despite its $100 million ocean of red ink.

4) LIGHTS OUT/GOODNIGHT: Without new investment, Carbonite’s current unsustainable cash “burn rate” will put it out of business in three years.

5) IMPENDING STOCK SLIDE: Watch for Carbonite’s stock price to now drift downward toward the $2-$3 range (representing cash-in-the-bank) — because its kamikaze CEO David Friend couldn’t endure Rush Limbaugh’s absurdist political humor –- alienating millions of customers and shining a nationwide spotlight on Carbonite’s dismal published financials.

6) WHY INVEST?: Carbonite long-ago missed its window-of-opportunity to rule the online backup market. Why would anyone now make a long-term investment in this dot-com “Titanic” — unless perhaps they are looking for a tax write-off?

LukeHandCool | March 9, 2012 at 1:55 pm

If I were Rush, I would run with this. Steer into the skid.

Every day he should ask Ms. Fluke to accept his apology … in person on his show … to be followed by a debate.

During the debate they should discuss Bill Maher and the lack of outrage over his many insults over a long time to women.

And the tweeted hate at the death of Andrew Breitbart, a loving husband … shouldn’t there be outrage at what his grieving wife has to endure … she’s a woman.

AnniNomiNous | March 9, 2012 at 2:00 pm

I am in the process of canceling my family’s computers from Carbonite (I am/was a long-time customer). I also unsubscribed from all ProFlowers emails and will never order flowers from ProFlowers again. I am switching to Mozy computer backup – is this company politically affiliated with the liberals…does anyone know?

AnniNomiNous | March 9, 2012 at 2:15 pm

I also unsubscribed from JC Penney emails because they brought on Ellen DeGeneres as their new spokeswoman. What people do in their bedrooms I don’t care about, but JC Penney is trying to be politically correct, IMHO. Just let me shop in peace.

Rush said on his show the other day that it is not at all unusual for him to turn down prospective advertisers. With the size of his audience, I expect his rates are sky high. So losing a couple (and making examples of them when they come crawling back) may actually be quite profitable for him. And fun, too!

Good for Rush! I wish I could tell the people who pay me to take a flying leap (Not that I would. I love my job. It would just be nice to have that freedom).

Henry Hawkins | March 9, 2012 at 3:46 pm

Rush always plays these things – and liberals – like a fiddle. Either of the roadrunner vs coyote or Lucy-pulling-away-the-football-on-Charlie Brown analogies work.

CBS MarketWatch’s Chuck Jaffe has published a good critique of Carbonite’s financials:

I am much more pessimistic than he is. Unless the Law of Gravity is repealed, Carbonite cannot prosper while it is vaporizing $2 million-per-month of cash.

(You can’t make up for losses with volume! If your outgo exceeds your income, your upkeep will be your downfall.)

NASDAQ:CARB could hope to use its $60 million pile of IPO cash to acquire competitors … but they are all underpricing their services at $5/month in a commodity market that is now swarming with competitive startups.

Crikey! Amazon even sells Rob Cosgrove’s book for startups:

The online backup market can thus be expected to experience a massive shakeout and implosion.

I submit that Carbonite was doomed even before its intemperate CEO slapped Limbaugh in the face.

And we can expect Carbonite CEO David Friend to be gone sooner rather than later as NASDAQ:CARB hits the skids.

Good for Rush. Most people want access to his audience. For those who don’t care that no one is listening there is MSNBC.

AnniNomiNous | March 9, 2012 at 8:33 pm

Check out Drudge…Gloria Allred is now trying to get Rush arrested for his comments about the law student…Gloria better realize that she is playing with fire.

More on “THE CARBONITE TITANIC” … this pathetic dot-com is so utterly doomed.

In hindsight, it’s embarrassing that Limbaugh and Levin shilled for Carbonite, given its inevitable fire-sale liquidation at about the time its CUMULATIVE LOSSES REACH $150 MILLION.

I love it when hypocrites throw an egg at something and it ricochets back and smack them in the head. Carbonite?? I’m not even a huge fan of Limbaugh, just an occasional listener when something like this happens. Just a quiet, conservative with a lot of built up frustration over the current administration. But I LOVE IT when CEO’s burn their own tush. Being an IT professional by trade, I was a Carbonite customer myself along with a lot of my clients. My phone began ringing that same day with requests or inquiries if they were using Carbonite for their back up. Some clients make that decision themselves and some leave it up to me to make that decision for them. Up until til this SNAFU, I had exactly 19 accounts with Carbonite, including my own personal account. Needless to say they have 19 less accounts. It took me about a total of 10 hours over 3 days to cancel them all. Hmmm… Phone lines were pretty busy, I wonder why?? Having to listen to their begging and pleas to remain a customer took some time until they finally realized I controlled many accounts and I was not going to reconsider then the pleas became just plain rude. Oh well, no biggie for me. That’s my job and that’s what I get paid to do. Even the accounts I have, that the client decides who to use wanted to leave Carbonite also. The hilarious thing was I had found about the CEO being a hypocrite after cancelling the accounts. My decision to leave, along with my clients that choose was based on the whole 1st Amendment, Freedom of Speech issue. It’s perfectly OK for this Fluke to sit in front of a Congressional Hearing and flat out LIE about her age, what her background is etc.. She is not some poor innocent schoolgirl that got beat up by big, bad El Rushbo! I can’t see why she shouldn’t be charged with perjury if she was under oath during her testimony. Anyway, this day light savings thing has left my mind still asleep. It’s ok for say Bill Mayher to use every attack word in the book to describe other politically active people, but Rush opens his mouth and it’s the end of the world. I had to laugh when I seen Carbonite’s stock take a beating, not because of negative outlooks, not because of anything financial or business related but because it seems a lot of Limbaugh’s audience, even tune in once in a while’s like me, dumped their stock by the barrel. Now to find out not only is the CEO not the smartest tool in the shed but he is also a huge HYPOCRITE after reading the story about Schultz, good for him. I’m happy, my clients are happy, we even got a small but nonetheless a discount with another company on the same services Carbonite once provided for us. Then to see the story of the Mattress company involved, pretty much begging to come back with their ads on during his show and being turned away… I love it!!! Just like Saturday Night Live last night, I caught the opening and talk about the Kool Aid flowing! It was a skit about Rush losing all of his advertiser’s and how desperate he was. Yeah!! Right NBC!! Can you distort the truth any more? Is it even possible?? Just ranting away this morning, need some coffee to wake up a little more but this story made my day already!! Oh, one more THING and I do mean THING. What’s her face, Allred?? That media whore attorney trying to get the Florida State’s Attorney to press charges against Rush?? For what? Exercising his 1st Amendment Freedom of Speech?? Such a double standard in this country. What a loser!!!