QUOTE AND NEWS
TechCrunch  Apr 24  Comment 
Mitel, the enterprise communications company that tried but failed to buy Polycom for $2 billion, is now being acquired for $2 billion itself. The company today announced that it has agreed to be acquired by Searchlight Capital Partners in an...
Motley Fool  Apr 19  Comment 
The cloud storage company could be heading back to the stock market soon.
TechCrunch  Mar 27  Comment 
Rackspace, which was taken private in a $4.3 billion deal in August 2016 by private equity firm Apollo Global Management, is reportedly in consideration for an IPO by the firm, according to a report by Bloomberg. The company could have an...
TechCrunch  Jan 4  Comment 
 Several cloud vendors began responding to the chip kernel vulnerability that has the industry reeling today. Each Infrastructure as a Service vendor clearly has a stake here because each one is selling CPU cycles on their platforms. TechCrunch...
Forbes  Nov 17  Comment 
This week, HPE and RackSpace announced OpenStack Private Cloud with pay per use, which the companies are heralding as a pivotal moment in the private cloud market. I’m feeling positive about this offering from HPE and Rackspace. Here are my...
Cellular News  Sep 21  Comment 
FourV Systems, a provider of security operations business intelligence systems, today announced the addition of two senior officers to its Board of Advisors. The combined expertise of these new additions positions FourV to...
TechCrunch  Sep 11  Comment 
 Rackspace today announced its intention to acquire Datapipe, one of its largest competitors in the managed public and private cloud services business. Rackspace expects the acquisition, which is its largest one yet, to close in the next...
Cloud Computing  Jul 26  Comment 
In his session at 20th Cloud Expo, Mike Johnston, an infrastructure engineer at Supergiant.io, discussed how to use Kubernetes to set up a SaaS infrastructure for your business. Mike Johnston is an infrastructure engineer at Supergiant.io with...
TechCrunch  Jul 18  Comment 
 Rackspace, which strongly focuses on managed services these days, today announced a partnership with Pivotal, the company behind the open source Cloud Foundry platform as a service project. Rackspace already offers managed services for AWS,...




 

Rackspace Hosting (NYSE:RAX) is a hosting company that runs its clients' web servers at its own facilities, allowing clients to reduce the number of in-house servers and in-house IT professionals needed to run them. Rackspace is the first managed hosting company to go public. Rackspace management says the company's services go beyond just keeping servers up and running - the company sells its clients "computing on demand" and related services - anything from email systems, load balancing strategies, system stress testing, better monitoring, and higher security.

Rackspace' revenue has grown around 60% each year for the last three years, and the company's customer base has grown 227% since 2005.[1] The company attributes its rapid growth to its customer service. Rackspace does not use call centers, but instead has experts from Rackspace, Microsoft, and Red Hat available 24 hours a day. Another factor driving demand is the rise of new technology that is making hosting a more attractive and cost efficient option. Virtualization helps reduce hardware costs by allowing multiple “virtual operating systems” on one server rather than having one physical operating system on the server. This can therefore decrease the number of necessary servers by sharing a single computer among multiple rackspace clients. The expertise and manpower to manage and operate a large virtualization system makes hosting a more desired option for companies. Cloud computing offers a cheaper alternative to leasing a dedicated server, because it allows a customer to use space and bandwidth from a central server rather than leasing its own personal (dedicated) server.

Company Overview

Rackspace serves 29,193 customers and 36,692 servers with its 2,600+ employees.[2] Rackspace's customers are businesses, web designers and web developers. During the year ended December 31, 2009, the Company served more than 90,000 business customers and managed more than 56,000 servers, 1,600,000 e-mail accounts, and 259,000 cloud hosting domains.[3]

Business and Financial Metrics

First Quarter 2010 Results[4]

Rackspace reported net revenue for the first quarter of 2010 of $178.8 million, an increase of 23.2% year-over-year and 5.5% from Q4 2009. Adjusted EBITDA was $59.4 million, an increase of 31.8% year-over-year and 6.1% from Q4 2009. The company achieved adjusted EBITDA margin of 33.2%, up from 31.1% in Q1 2009 and 33.0% in Q4 2009. Net income of $9.8 million grew 48.9% year-over-year and 8.6% from Q4 2009

Business Segments[3]

Dedicated Hosting

Dedicated hosting delivers a customer-specific, dedicated server, located in the Company’s business-class data centers. The Company’s customers have full administrator privileges and are responsible for most administrative functions. It provides a customer management portal and other management tools, including managed hosting, Private Cloud and managed colocation. The Company’s core service offering is managed hosting. This service removes the burden of managing the data center, network, hardware devices, and operating system software from the customer. Rackspace offers a Private Cloud service that allows large enterprises to virtualize their dedicated information technology (IT) environments. Platform hosting serves the demands of highly technical customers who require ordering and provisioning support. Managed colocation customers manage most or all of their software and applications. The Company manages the data centers, networks and some standard hardware devices. Its platform hosting service is often combined with traditional managed hosting, allowing customers the flexibility to customize service levels for each hosting service component.

Cloud Hosting

The Company’s cloud hosting services allow businesses to run their custom applications, similar to managed hosting, but using the new technologies of cloud computing. There are multiple varieties of cloud hosting services that are priced on a pay-per-use basis and that can be scaled up or down on demand. The Company offers cloud servers, cloud files, and cloud sites. Cloud servers allow customers to purchase slices of servers, load their applications onto those virtual servers, and pay only for the capacity they use. Cloud Files allow customers to purchase storage services by the gigabyte. Cloud Sites allow customers to deploy their applications to a cluster of servers that will scale processing on demand and as required by the application.

Cloud Applications

This cloud category, often called software-as-a-service, delivers applications provisioned and ready for end-customers to use. These services require limited support from the customer’s IT department. The Company offers e-mail, collaboration and file back-up cloud applications. These cloud applications are priced on a pay-per-use basis.

Hybrid Hosting

The Company offers Hybrid Hosting. Hybrid Hosting is a suite of dedicated hosting and cloud computing services.

The Company competes with AT&T, British Telecom, SAVVIS, Terremark, The Planet, Verio, Amazon, Microsoft, Google, IBM and Salesforce.com.

I don't understand smeothing, maybe someone can explain I understand that a cloud setup can balance between servers, by that I understand that it balances things like requests and ram usage, but how is the database thing done? For example a visitor logs in to a high traffic site, it can have 1000 servers but it still needs to read the user's user/pass from one db location, right? Or maybe the different servers keeps copies of the database synchronised non-stop? How does this work^ ?

Competition

Rackspace competes with other hosting companies, as well as IT outsourcing firms like Infosys Technologies (INFY) and Wipro (WIT). However, most of Rackspace's closest competitors are not public companies.

References

  1. Retail Roadshow, Rackspace
  2. Retail Roadshow, Rackspace
  3. 3.0 3.1 Reuters: RAX Company Profile
  4. "Rackspace Hosting Reports First Quarter 2010 Results"
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