Rackspace: Managed Services Meet the Cloud

MSPs generally believe that colocation and managed services can play together nicely. The thinking: colocation provides a useful onramp for companies just beginning to outsource IT infrastructure and may well upgrade to managed services over time. But what about cloud services? As MSP move in that direction, will traditional managed services get on with the cloud? Or will the latter cannibalize the former? Take a look at Rackspace Hosting Inc. for some clues.

For Rackspace, the combination of cloud and managed services seems positive so far. Lew Moorman, president of Rackspace’s cloud business and chief strategy officer, speaking last week at company-hosted investor conference, said Rackspace’s cloud offerings have been “mostly additive” thus far.

Bigger customers, in particular, “are adding these services on top of traditional managed hosting for workloads they wouldn’t have thought to bring to use before,” he said.

Those customers can now tap Rackspace for testing/development and archiving — services that may not have made economic sense for them previously, he added.

Moorman acknowledged that single-server customers that don’t need a dedicated machine should move to a cloud server. But on the balance, he said, the company has found that customers buy cloud services in addition to, rather than instead of, dedicated hosting.

Rackspace’s multi-tenant cloud offerings fall into two categories: Cloud Hosting and E-mail & Apps. Cloud hosting consists of three lines: Cloud Servers, Cloud Sites, and Cloud Files. Cloud Servers provides on-demand servers, while Cloud Sites lets customers run applications on a fully-managed cluster of computers. Cloud File, an online storage service, can be ordered independently or as an add-on service.

On the E-mail & Apps side, the primary application is e-mail but the service supports other business applications as well.

Moorman said the company has recently moved to consolidate its services under the Rackspace brand. Mailtrust now operates as Rackspace’s E-mail & Apps division, for example. Similarly, the Mosso brand has been withdrawn in favor of Rackspace Cloud Sites.

Contributing blogger John Moore covers Master MSPs, Web hosts and emerging opportunities. Follow MSPmentor via RSS; Facebook; Identi.ca; and Twitter. And sign up for our Enewsletter; Webcasts and Resource Center.