Iron Mountain boss out as storage legend brings Reese back

The chief executive of storage stalwart Iron Mountain has stepped down in a surprise move, to be replaced with the company's chairman, and former chief executive, Richard Reese.

The move comes as the company is under pressure from hedge fund Elliott Management, which owns five per cent of Iron Mountain stock, and is reportedly questioning the company's strategy. Iron Mountain recently quit the cloud storage business to focus on more traditional areas.

The company declined to comment beyond an official statement.

"I am honoured to have the opportunity to lead this organisation and work once again with the talented group of people at Iron Mountain, as we continue to build value for our customers and stockholders alike," Reese said in the statement.

"I look forward to discussing our plan with stockholders in the near future."

Rob Enderle, principal analyst at the Enderle Group, told V3.co.uk that Iron Mountain faces the need for a radical rethink of its corporate strategy. The company has an excellent reputation for reliable data storage, but had not adopted new techniques to keep up with industry demand.

"Iron Mountain is great for storing stuff, but not so good at finding it again. The shift it needs to make is like turning DEC to Google," he said.

"It tried to move from physical storage to digital storage, but the effort failed. The company needs to move itself into this century, but that needs a lot of new talent."

Enderle suggested that Reese, who was chief executive from 1981 to 2008, would most likely be interim leader. Either a younger executive would be recruited, or the company would acquire a rival with the right management philosophy.

Iron Mountain began life as a mushroom farming company, using underground caves hollowed out by mining. With the advent of the Cold War in 1951, the company used the former farming facilities to provide safe data storage in case of nuclear attack, and the company has a good reputation for providing reliable storage facilities.

Enderle explained that the company was seen as out of touch with modern storage options however, and needed to radically rethink itself in line with current market realities.