Rackspace's New Cloud Portfolio

As your would expect, and desire, from a cloud announcement, the Rackspace event this afternoon were very clear and direct this morning. There’s not a lot of wiggle room for nuance. The nut is that Rackspace announced a portfolio of three cloud offerings:

• Cloud Sites – Rackspace moved the technology behind their existing cloud holding, Mosso, to “Cloud Sites.” All of the Cloud offerings fly under the Mosso umbrella.
• Cloud Files – started up cloud storage and purchased Jungle Disk who provides cloud-backed desktop backups. Clearly, Jungle Disk will be extended to work with Rackspace in addition to Amazon S3.
• Cloud Servers – Rackspace purchased Slicehost who offers no-hassle pricing, developer-targeted hosting.

Here, the desires of cloud computing revolve around cheap, metered pricing and elasticity, that is, being able to scale up and down on-demand, hopefully more automatically than manually.

And, it bears worth mentioning that Rackspace will continue their traditional, existing managed hosting options.

Was this a good idea?

Rackspace, which recently IPO’ed, looks to be spending its cash (between $11.5M and $16.5M) nicely here. If you’re one of the biggest hosters in the world at the moment, you’d be insane not to offer something when it comes to cloud computing. Offering hosting and storage, and buying an existing pool of cloud-ish oriented customer (with Slicehost and Jungle Disk) is a good boot-strap for my fellow Texans.

This is the kind of think us RedMonkers are always hoping IBM, Sun, and other traditional companies would just do. (To their credit, there were some IBM’ers in the crowd sniffin’ things out.)

Pulling back even further, Rackspace isn’t really innovating anything new here when it comes to the still young world of cloud computing. For instance, we still need those cloud standards. Instead, Rackspace is pulling together it’s slice of the cloud pie. No problem there, really. Building a gorilla can be a good “innovation” if used well.

Sites and Servers

As John and I discussed yesterday when speculating about this announcement, the complaint about Rackspace’s existing cloud-offering, Mosso, was that it had no API. This means you can’t build third-party management stacks on-top of it and get that degree of transparency and control that people would want from their cloud-infrastructure. Aside from creating an ecosystem for the likes of RightScale, CohesiveFT, rPath, & the rest of the Cloud Brat Pack, more control and transparency means more opportunity for differentiation for those “cloud software vendors” [CSVs?] who’re deploying on the cloud. Indeed, as the press release says:

Rackspace also announced widespread community interest in their cloud suite. A wide set of cloud tool companies have expressed intent to support the Rackspace cloud. The list of companies includes RightScale, CohesiveFT, rPath, SOASTA and Vertica. In addition, Sonian Networks, the leader in cloud mail archiving solutions, and Mailtrust, the Email Hosting division of Rackspace announced they had reached an agreement to offer low cost archiving to Mailtrust’s 100,000+ business domains. Through this agreement, Sonian Networks will also port their solution to the Rackspace cloud suite.

Well, it appears that Slicehost/Cloud Server has an API on-top of it. I must admit, I don’t know anything about the API except seeing that they have one. Clearly, at the very least the early adopters of cloud computing want as much control – paradoxically or not – over their cloud-based servers. Hopefully, Mosso will follow.

As more third-party background, in the general IT Management space, Rackspace is renowned for being a customer of everyone. You can talk to almost any IT Management company, big, small, open, or closed source and they’ll list Rackspace as customer. (So, don’t get too excited when they throw that logo up on the slide ;>)

Java

As a side-note, one interesting angle here is that Slicehost, among other stacks, runs Java. Finding Java hosting is pretty tough – if you want it cheap – and it’s execution model doesn’t always jive well with how “web programmers” want to think. This, in large part, explains why Java has never been huge on the web application scene, versus PHP or even rails.

For “Java people,” this has been an almost decade long pain in the neck.

To add in another interesting dimension for the Java-heads, as the obviously biased but nonetheless good-point-making, Orion Letizi, says:

Rackspace cloud looks like a good playground for Terracotta. [For example,] Rackspace scales out the virtual app nodes, Terracotta let’s them share state via network attached memory. [here and here]

Cloud Files – Storage

Online storage is clearly a market that’ll be even more of a race to the bottom (meaning, low margins and tedious profits) than it currently is. Differentiating and succeeding here is based on ease of use at volume and a regular decline in storage costs. It’s been awhile since I used Jungle Disk, but it was definitely one of the easiest and most “works how you’d think it would” applications for storing things in the cloud. Now if I could just mail that initial DVD set to get started instead of backing up everything up-front ;>

Charlie Wood (who has an excellently concise post on all this), who I went to the event with, had a good question at this point: how will Rackspace keep itself from competing with other application-layer sellers here? Effectively, Rackspace would be competing with anyone who wants to use Cloud Files to do online backups: to compete with Jungle Disk. The answer was that Rackspace aims to creep into the application layer as little as possible, that they want to be at the infrastructure layer. Well, Jungle Disk aside ;>

More than just online backups, having cloud based storage means being able to easily retrieve those files. Amazon S3 abounds with uses for storing all sorts of media and other assets online. Again, this market is a race to the bottom, so additional features are what matters here: giving people something to pay (extra) for. Here, Rackspace’s hope is that an (upcoming) partnership with Limelight’s Content Delivery Network (CDN) will allow Rackspace to charge more than the going rate for cloud storage.

A CDN is one of those nicely humanizing things about the mystic “tubes” that we always assume just work: it turns out that the closer the date you want is physically located, the better the chances of a faster download. CDNs do just that: mirror data at different places around the world.

Where from here?

For enterprises, the low-hanging fruit of cloud-computing includes off-site backup, email servers, and hosting intranets. Sure, there are more advanced things to host out there as the many exciting and weird Amazon EC2 uses we always hear about attest to. But, in “these troubled times,” you’ve gotta think about which low-hanging fruit you can start off-loading to synch up that belt.

Clearly, Rackspace is speaking directly to backup and email hosting noodling. The next question is how they’d do with hosting things like internal-only SharePoint instances, or even old intranet behemoths like Vignette to pick something out of the air. Could Rackspace gobble up an entire corporate intranet? Do those HR pages listing 2008 holidays really need to be on corporate servers?

Clearly, the appeal to the round-corner cool kids is with Slicehost and Mosso. But few cloud providers have bridges the seemingly short jump between powering Techmeme’s content and driving down the cost of boring but necessary behind-the-firewall applications. We’ll see if Rackspace gets up the gumption to strap together some logs and paddle across that river.

(If you’re sweet on all this cloud stuff, you really outta be listening to The IT Management Podcast we do here. It’s about 75% cloud now-a-days.)

Disclosure: IBM and Sun are clients, as is Microsoft.