Rackspace Taps Third party Service Providers to Build Out International Presence

Rackspace (disclosure – Rackspace supported the creation of the CloudU education program I formerly ran) is a little bit like the little engine that could. It’s continually fighting the perception (and, to be frank, the reality) that it’s the very poor cousin to the AWS steamroller. As such it needs to punch above its own weight to get recognition. It is most famously known as co-instigator of the OpenStack initiative but it’s also done a lot of innovative things around support, the nurturing of startups and general cloud evangelism. Despite this it’s still a distant second to AWS.

Part of the reason for this is the comparative capital situation of the two companies – AWS enjoys the cash from its mother ship, Amazon, while Rackspace needs to fund all its own expansion internally. A new initiative the company is launching aims to reduce this capital constraint. Rackspace is going o expand its global footprint through a program that will see the company build and run clouds for third party service providers (telcos and the like). Built to the same specification as Rackspace’s own cloud and, obviously, on top of OpenStack, these cloud will wrap up the technology layer (the cloud operating stack itself, custom tuning for the service providers particular situation and support on the non-technology parts, in particular sales and support.

MyPOV

For Rackspace, if they can make this stick, this is a no-brainer. Capital constraints and the realities of building a global network of data centers have meant that building a competitor to AWS of similar scale has been difficult. With this move the company can leverage the investment other organizations already have in infrastructure and re-purpose that infrastructure to create a virtual global footprint. I t would be interesting to know what this means for Rackspace’s own global expansion ambitions and in particular for the footprint it already has globally – there is potentially an interesting dynamic between a Rackspace owned data center in a foreign location and a Rackspace-built one owned by a third party.

For the service provider this also makes sense – depending on the economics, they are able to leverage a technical partner, a service & support partner and, perhaps most importantly, tap an existing global customer base. Part of the reason we haven’t seen mass scale migration of service provider’s facilities to cloud is that part of the process is a relearning exercise – both internally and externally. This new initiative allows them to use Rackspace’s skills for the all-important internal educational aspects, while also helps them to ease the medium-term customer churn pain. They’re able to gain customers directly from Rackspace. Ultiately it helps them move from traditional to cloud models and beefs up their resource utilization en route.

Of course this all relies on the economics and commercials being right, and we, as yet, have no visibility about how that will look. CEO of Rackspace, Lanham Napier is, of course, talking the partner interest up saying:

We have had interest from service providers on nearly every continent to extend Rackspace’s proven OpenStack powered public cloud solutions and expertise to their customers. It is important to broaden the adoption of open-source technologies through partners around the world. The creation of this network allows for different providers, in different regions, with different service characteristics to link together to better serve the cloud users around the world with a fully interoperable global ‘cloud of clouds’.

Lots of questions remain, and the proof of the initiative will be seen over time but, at face value at least, this looks like a good program – good for Rackspace, good for the service providers and ultimately, good for global customers who want more granular options over data location.