Rackspace Hosting is fanatically focused on hosting services, but also has its head in the clouds. The company provides a range of Web hosting and managed network services for businesses. It primarily offers traditional hosting services with dedicated servers, but is expanding into cloud hosting, which lets customers utilize pooled server resources on an on-demand basis. Rackspace also provides hybrid hosting, providing a combination of dedicated hosting and cloud computing. The company markets its services under the Fanatical Support brand. It has more than 130,000 enterprise customers and operates data centers in Hong Kong, the UK, and the US. Rackspace gets three-quarters of its sales in the US.
While the company generates most of its revenues from hosting subscription fees, a growing portion of sales comes from virtual and cloud technology services provided on a utility (on-demand) basis. Year-over-year sales for 2010 were up nearly 25% over 2009 for the perennially profitable company. Managed hosting revenues increased 19%, while revenues related to cloud computing services rose by around 78%. Rackspace attributes the higher sales for the year to growth both in the number of new customers and the array of services provided to its existing customer base. It has added a suite of combined dedicated and cloud computing services called Hybrid Hosting to its portfolio of products. The company is also actively pursuing customers in Europe and Asia for international expansion.
In 2012 Rackspace agreed to buy Mailgun, looking to add functionality to its Rackspace Open Cloud platform. Mailgun let users integrate e-mail from within applications. Also that year, the company acquired SharePoint911, a provider of consulting and training services for Microsoft's collaboration and document management software SharePoint. The purchase expands Rackspace's presence in SharePoint management market, which it entered in 2008.
Rackspace has invested in internal development and acquisitions to build its cloud hosting business. In 2010 the company launched several new products, among them OpenStack (an open-source cloud platform), Cloud Servers for Windows (on-demand service for Windows users), and Rackconnect (integrates the Rackspace Cloud with dedicated hosting services). On the acquisition front, the company bought San Francisco-based cloud data server management software startup Cloudkick in late 2010 to add tools for automating tasks for systems administrators. Previous purchases include cloud storage specialist Jungle Disk and cloud hosting service provider Slicehost. Rackspace also offers a suite of combined dedicated and cloud computing services called Hybrid Hosting.
Chairman Graham Weston owns nearly 15% of Rackspace Hosting. – less