because that was the biggest issue in the original article, they didn't have backups of their data, so the company was dead. If they had had backups, they could have recreated the infrastructure.
Okay, but say you do get shutdown and you have your offsite backups, like most people. It's still a significant amount of work starting from scratch to rebuild and link all of your servers, dbs, services, etc. Plus all of the basic OS tweaking.
Losing your backups because your on one site is always dangerous. Getting completely kicked off your VPS systems with no warning or help is what's new and scary about this DO story.
They did have backups, only problem backups was also on DO. Backing up petabyte of data even on a Gbit connection is slow, and also cost more then a pennies if you for example back it up on AWS. Linus tech tips have a video on youtube explaining the problem.
The original post literally mentions "all our data (500k rows)" i.e. a data amount so small they could probably back it up to their cellphone every five minutes.
It's not really a "backup" if it's just on the same server/data center though. Moving data from one drive to another in the same machine, or from one machine to another in the same building, provides fault tolerance should the main drive/machine die, that's about it.
That's true whether the computer(s) is your own or someone else's.
Losing your backups because your on one site is always dangerous. Getting completely kicked off your VPS systems with no warning or help is what's new and scary about this DO story.