Rackspace Inc. is a managed cloud computing company based in Windcrest, Texas, USA, a
suburb of San Antonio, Texas.
The company also has offices in Australia, the United Kingdom, Switzerland, Israel, The
Netherlands, India, and Hong Kong, and data centers operating in Texas, Illinois, Virginia,
the United Kingdom, Australia, and Hong Kong.
The company's email and apps division operates from Blacksburg, VA; other offices are located
in Austin, Texas and San Francisco, California.
History
In 1996, Richard Yoo started a small Internet service provider called Cymitar Network Systems
out of his garage apartment in San Antonio, Texas.
The company began doing application development work in addition to offering basic Internet
access and web hosting.
In 1997, Yoo brought on Dirk Elmendorf.
When the company began to develop Internet applications as its primary business, the
company was re-formed as Cymitar Technology Group.
As Cymitar Technology Group grew, Patrick Condon was recruited from California and joined
the team in 1998.
Coincidentally, all three of the company's founders were students at one time at Trinity
University in San Antonio.
Although the founders began as application developers for end users, they found that
most companies did not either know how or want to host their applications.
The founders wanted to focus on application development–not hosting–but they were
unable to find an opportunity to outsource the hosting work.
Eventually, the founders realized that it would be better to create a product to serve
the hosting need and launch it as a company.
Rackspace was launched in October 1998 with Richard Yoo as its CEO.
Although most hosting companies focused on the technology end of hosting, Rackspace created
its "Fanatical Support" offering to focus on service and support.
On March 28, 2000, Rackspace received funding through Norwest Venture Partners and Sequoia
Capital.
George J. Still, Jr., Managing Partner at Norwest, subsequently joined the Board of
Directors.
Business model Rackspace has two primary lines of business
— Cloud Servers and Dedicated Servers.
Rackspace helps design, build, and operate workloads across both environments depending
on the individual needs of the customer.
Cloud Servers The Managed Infrastructure service level provides
a core set of services necessary to set customers up in the cloud, including architecture advice,
security assistance, and code development assistance.
The Managed Operations support level provides all Managed Infrastructure services plus additional
proactive support.
Dedicated Servers The Managed service level consists of on-demand
support where proactive services are provided, but the customer can contact Rackspace when
they need additional assistance.
The Intensive service level consists of proactive support where many proactive services are
provided, and customers receive additional consultations about their server configuration.
Highly customized implementations generally fall under this level of support.
Involvement with other companies Rackspace launched ServerBeach in San Antonio
in January 2003 as a lower-cost alternative for dedicated servers designed for technology
hobbyists who want flexibility and reliability.
Richard Yoo was a catalyst in the startup of ServerBeach.
A bandwidth and colocation provider, Peer 1 Hosting, purchased ServerBeach in October
2004 for $7.5 Million.
Peer 1 Hosting entered the UK managed hosting market in January 2009 and the ServerBeach
brand now competes directly with the UK arm of Rackspace, run by Dominic Monkhouse, former
managing director of Rackspace Limited.
In October 2006, Mosso Inc. was launched, which experimented with white-labeling hosting
services.
Eventually, the division became the foundation for the Rackspace Cloud Computing offering.
On October 1, 2007, Rackspace acquired Webmail.us, a private e-mail hosting firm located in Blacksburg,
VA.
Originally branded as Mailtrust on May 20, 2009, it became part of the newly formed Email
and Apps division of Rackspace.
On October 22, 2008, Rackspace acquired Slicehost, a provider of virtual servers and Jungle Disk,
a provider of online backup software and services.
Expansion into the Asia Pacific Region The company is experiencing growth in the
Asian marketplace.
The Asian office is a natural step in Rackspace's expansion outside the U.S. and London to cater
for worldwide customers’ needs in Hong Kong / China.
Rackspace selected Hong Kong as the Asia Pacific regional office in part because of its reputation
within the global business economy, its IT infrastructure, multiple telecommunication
providers and rich talent pool.
Rackspace also solicited feedback from its current customer base in the Asia Pacific
region, and the majority of those respondents confirmed their preference for doing business
in Hong Kong.
In the news In 2008, Rackspace moved their headquarters
from a building once occupied by Datapoint Corporation to the then-unoccupied Windsor
Park Mall in Windcrest, Texas.
Rackspace's Chairman, Graham Weston, owned the Montgomery Ward building in the mall until
2006, when it was sold to a developer.
The city of Windcrest purchased 111 acres south of the mall to create a residential
and retail complex.
The facility is located next to Roosevelt High School, and many Roosevelt students intern
at Rackspace.
The Fortune magazine's "Top 100 Best Companies to Work For 2008" placed Rackspace as #32
the first year that Rackspace applied for consideration.
The company was praised for its transparency.
Regular "Open Book" meetings are held where the top level leaders share in-depth financial
information with all employees.
In 2011 and 2013, the company was named as one of the top 100 places to work by Fortune.
On August 8, 2008, Rackspace opened for trading on the New York Stock Exchange under the ticker
symbol "RAX" after its initial public offering in which it raised $187.5 million.
The initial public offering included 15,000,000 shares of its common stock at a price of $12.50
per share.
The IPO did not do well in the public market and lost about 20% of its initial price almost
immediately.
At around 3:45PM CST December 18, 2009, Rackspace went down.
Rackspace experienced an outage for customers using their Dallas-Fort Worth data center –
including those of Rackspace Cloud, again.
This time, many high profile sites decided to make alternate plans at other hosting companies
to avoid future problems.
On September 8, 2010, Rackspace received national attention when they decided to discontinue
providing web hosting service to one of their customers, Dove World Outreach Center.
This was in reaction to Dove World's pastor Terry Jones' plan to burn several copies of
the Qur'an on the anniversary of the September 11th attacks.
Rackspace claims that this violated their company policy.
This move came under criticism, notably from Terry Jones himself, who described it as an
"indirect attack on our freedom of speech."
Others questioned the appropriateness of Rackspace's action, stating that there is "absolutely
no reason for web hosts to have an editorial policy, and this only gives Jones more attention,
and makes him look more persecuted."
On June 3, 2011, Rackspace intervened in an application by Queensland host Rack Servers
to trademark its business name in Australia.
On May 26, 2013, Author Bill Schley's book 'The UnStoppables', which was inspired by
the culture at Rackspace, became a New York Times bestseller.
On May 15, 2014, Rackspace hired Morgan Stanley to evaluate strategic options including selling
to or merging with other technology companies.
Acquisitions On October 22, 2008, Rackspace announced it
was purchasing cloud storage provider Jungle Disk and VPS provider SliceHost.
On February 16, 2012, Rackspace acquired SharePoint911, a Microsoft SharePoint consulting company
based in Cincinnati, Ohio.
Other acquisitions include: Cloudkick, Anso Labs, Mailgun, ObjectRocket, Exceptional Cloud
Services, and ZeroVM.
Worldwide Rackspace serves customers worldwide and has
offices in the USA, Australia, United Kingdom, The Netherlands, Switzerland, Israel, India,
and Hong Kong, and data centers in the USA, Australia, United Kingdom, and Hong Kong.
Rackspace is registered in the UK as Rackspace Ltd. and as of 2013 employed approximately
900 people, at an office and a rented data center.
The company opened a fourth UK data center in Slough, Berkshire in the second quarter
of 2008.
Some organizations served by Rackspace's UK web hosting services include Confused.com,
Vue, Renault, online publication The Register, Huddle, Funny or Die, Metacafe, Suicide Girls,
and net connect.
Rackspace Benelux in Amsterdam opened its offices in October 2007.
It won several customers such as LogicaCMG, Exact Software and CapGemini.
Rackspace Australia in Sydney opened its offices in March 2009.
It won several customers and partners such as Westfield Holdings, Wotif.com, Sage Australia,
Xero, Netstarter and Market Boomer.
Awards In 2014, Rackspace was ranked 29th in the
Fortune 100 list of best companies to work for in the US.
Starting from 2007, Rackspace has appeared on that list for 6 out of 7 years.
Rackspace UK has also appeared in The Sunday Times best employers' awards for each year
between 2007 and 2013.
The UK division of the company has also been a part of the "Great Place To Work" rankings
for 9 consecutive years from 2004, coming in 4th place in 2013 & 6th in 2014.
OpenStack
In 2010, Rackspace contributed the source code of its Cloud Files product to the OpenStack
project under the Apache License to become the OpenStack Object Storage component.
In April 2012, Rackspace announced it would implement OpenStack Compute as the underlying
technology for their Cloud Servers product.
This change introduced a new control panel as well as add-on cloud services offering
databases, server monitoring, block storage, and virtual networking.
References
External links Official website