startupmania

Cloud computing service Ghost has closed its doors, as the company’s managers informed its 400,000 user base around the world, said company founder Dr. Tzvi Shreiber at the CeBIT committee, which assembles parallel to the CeBIT convention in Hanover, Germany.

The reasons, he says, are the raging economic crisis and the fact that big companies (such as Microsoft and Google) have entered the market. Dr. Shreiber and the venture capital firm Benchmark, chief investor in the project, are trying to find a buyer who will maintain development of their product to the business market.

Dr. Shreiber, who in 2000 sold the start-up Tradeom to VerticalNet for $5 million and, several years later, sold Unicorn to IBM, explained in an interview to People & Computers that “Ghost essentially created a virtual computer, a website with a desktop, file system and application all incased within the web page.” He adds, “As of today, we have invested six million dollars in writing millions of lines of code, and have nine patents to our name.”

He pointed out that one of Ghost’s key features was the location of their development center. “Our center was located in Ramallah, and at our prime – employed roughly 30 employees. We chose the best engineers from the graduates of palestinian universities. The experience was fantastic, we had a great time working together. We had very nice output, the fact remains that we created a product that was used by 400,000 people worldwide.” He added that, “We made it through two wars.” Dr. Schrieber explained that during the war in Gaza, the company saw conflict amongst its employess, some of which are Israeli who were enlisted in the military and others, Palestinians with families in bombed Gaza.

How was the work done? Israelis can’t enter Ramallah and Palestinians have a hard time entering Israel.

“While it’s true we could not work face to face, despite the short distance between Jerusalem and Ramallah, we had to work via Skype. Occasionally we were able to obtain entrance permission for our Palestinian employees, and they would meet us in Israel.”

What was the problem with the service?

“Our product was good and was heading in the right direction, but there were other problems. First, the economic situation caused a severe drop in funding and secondly, big-name competition entered the field. It became a big-player’s game with Microsoft and Google, and the bottom line is that Google allows some of the functionality for a fraction of the price it costs me to get appropriate storage.”

What will become of the employees?

“We are trying to find a buyer for the company, with the employees included. At this stage we intend on continuing development and hope to find a buyer who can make use of the technology, perhaps applying it in the business market.”