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Rackspace CTO interviewed, Virtualization strategy discussed

I had almost forgotten that I'd spoken to John and forgot to follow up. I normally tell the PR folks to do that for me as I can't keep up with all the interviews.

Anyways here's my discussion with John Engates, CTO at Rackspace.

Tell us a bit about Rackspace.

Rackspace delivers enterprise-level IT hosting services to businesses of all sizes. Rackspace currently servers more than 15,000 customers and operates eight data centers worldwide. Companies are able to customize Rackspace’s technology to meet their business needs via the company’s award-winning Fanatical Support™.

Rackspace is a provider of hosted IT services, delivering a diverse suite of enterprise-class hosted IT services to businesses of all sizes. Customers choose Rackspace for its hosting specialization and expertise, backed by the company’s award-winning Fanatical Support®. By integrating the industry’s best technologies and delivering them as services, Rackspace serves as an extension of its customers’ IT departments. Because Rackspace removes the burden of infrastructure maintenance and management, customers can focus on their core business. Rackspace's portfolio of companies also includes the Mosso® cloud computing platform and Mailtrust™, a provider of business-class hosted email solutions. Rackspace is recognized as one of FORTUNE Magazine’s 100 Best Companies to Work For, ranking number 32 on the 2008 list.

Why did you turn to virtualization? Why all that change in strategy?

Rackspace is always looking to offer our customers the latest and greatest technology, if we truly believe it will benefit them. We have been watching the virtualization industry for some time now and conducted a customer survey to see if companies were open to the idea of virtualization. The survey revealed that most companies would be open to virtualized servers as long as the physical server was dedicated to them—in other words if they weren’t shared with other companies. Dedicated servers have been Rackspace’s specialty, so it was a natural fit to migrate into the dedicated virtualization space. We spent many months researching various virtualization offerings and decided that VMWare had the most reliable option for our customers.

Additional key findings from the customer survey include:

  • 72 percent of respondents are comfortable hosting mission-critical applications in a production environment on a virtualized platform
  • 71 percent of respondents would prefer to host their applications on a virtualized platform with a hosting provider
  • 57 percent of respondents are using virtualization for in-house applications
  • Only 13 percent of respondents were certain they would be willing to implement virtualization on a shared environment, with the majority expressing concerns stemming from performance and security vulnerabilities in shared environments.

Tell us a little about your ambitions and your build-outs across the globe?

Rackspace for the past several years has operated solely out of the U.S. and U.K. offices. Our eighth data center, based in Slough, England, will open this summer, which operates fully on renewable energy. Recently, however, we’ve been focusing on expanding into Hong Kong to capture more of the Asian market.

We also have built an internal research and development department at Rackspace called RackLabs. RackLabs constantly looks for groundbreaking technology, like virtualization, that Rackspace can leverage in our product offerings.

Tell us about your product line and offerings?

In addition to providing managed hosting on traditional physical servers, Rackspace now offers business class email hosting through Mailtrust and a hosting cloud offering through Mosso.

Rackspace also recently announced the launch of a virtualized server hosting program. The virtualization offering will be based on dedicated physical hardware for each customer, using VMWare to provide server virtualization. In the same way that Rackspace supports physical servers and operating systems today, Rackspace manages the virtual servers and operating systems for our customers.

Additional benefits and features include:

  • Customized technology
  • Fully supported by Rackspace’s Fanatical Support
  • Hybrid virtual/physical environments
  • Expert support for customers to design their individual system
  • Maximizing flexibility
  • Ease of management (more data protection options, simplification of complex technologies)

Do we see companies adopting increasingly for a DaaS (Data Center as a Service)?

At Rackspace, we do see more and more companies wanting to offload their data center needs to hosting providers. We recently transitioned Rackspace from offering managed hosting into a broader category of IT hosting. Our business customers were asking to bring more and more of their data center needs to Rackspace including virtualization, mail hosting, back-end IT applications and more, so we answered the call.

With our recent acquisition of business mail provider Mailtrust and new offerings such as our dedicated virtualization offering, we’ve added new services to our product portfolio that take more of the data center and IT infrastructure needs off our customers’ plates. Rather than servers, we’re focusing more on IT hosting services for our customers.

If you need the technology, you also need good technical staff, how do you hire and retain them in these difficult times?

Rackspace, more so than any other company I’ve ever worked at, works hard to make sure employees know they are appreciated. CEO Lanham Napier believes that happy employees results in better customer service, which results in happy customers. With that in mind, Rackspace does everything in the company’s power to attract and retain the best and the brightest in the business. The company has a thorough interview process to identify top-notch candidates and make sure the interviewee will be a good fit at Rackspace. To retain employees, Rackspace has numerous benefit programs in place, including bi-monthly Open Book and Town Hall meetings for employees to air ask questions and hear about quarterly results, an annual “Racktoberfest” celebration, reminiscent of Oktoberfest, free healthcare, Rackspace University, and countless other perks and rewards for jobs well done.

What about your customers? Do they even need to know how their software/service is running?

We think it’s important that data center and hosting providers remain open and transparent to their customers, and that the customers know how their applications, mail, servers, etc. are running. Customers are trusting their businesses in the hosting provider’s hands, and therefore they should have a thorough understanding of their infrastructure to alleviate security concerns, abide by security guidelines and regulations, etc. Some of the cloud offerings today, such as Amazon S3, offer no visibility whatsoever into their infrastructure, which would greatly concern me if I were a business owner. Businesses have governmental regulations to follow as well as customers that are holding them accountable.

How are the sales doing especially with the shaky market lately?

As the economy takes hits, IT budgets generally shrink as a result. For Rackspace and other outsourcing providers, lower IT budgets often result in more interest in outsourcing for the cost savings benefits. Rackspace can offer the data center, multiple top-tier networks, top-of-the-line hardware and the expert IT staff to manage the infrastructure at a fraction of the cost it would take to maintain this set-up in-house.

Do you have any "cloud ambitions"?

As I mentioned earlier, Rackspace is constantly on the look-out for innovative new technologies that can simplify hosting for our customers and cloud computing is certainly a viable option in that regard.

Mosso, Rackspace’s cloud computing subsidiary, is an advanced cloud computing offering that eliminates the cost and complexity of scaling web infrastructure, specifically for developers and companies looking to deploy large web applications. Mosso enables developers to get their applications up and running in three easy steps: choose a domain, select operating system of choice and set default technology. Developers do not need to worry about underlying technology such as servers, VPS’s or operating systems. The new solution combines a ‘best-practices’ hosting environment with easy online management — allowing the developer to choose the framework that best meets their needs. Mosso’s new utility pricing model ensures that subscribers then pay for only the capacity they use. The Hosting Cloud supports Windows and Linux platforms as well as leading technologies such as PHP, Ruby on Rails and .NET.

Rackspace will also continue research on cloud computing for the enterprise. Although the technology isn’t quite there and the market isn’t ready for it, once cloud computing makes sense for the enterprise and when the technology is mature enough to support this market, we hope to be addressing those needs for our customers.

Tell us something about Mosso?

As I mentioned earlier, Mosso is a Rackspace company that was founded by two former Rackspace employees. The Hosting Cloud was created by Mosso to give developers access to the benefits of cloud computing without the technical complexities and trade-offs associated with existing solutions. To execute its vision, Mosso tapped into Rackspace’s technology expertise and deep resources to develop the standards-based cloud computing technology that now runs The Hosting Cloud.


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