John Engates is chief technology officer for Rackspace, a preeminent hosting firm. Rackspace was launched in San Antonio in 1996 and now, in 2009, the corporation's stock is publicly traded. Rackspace's 2008 revenues surpassed $500 million and they have information centers located around the planet. In this Quick Query, Engates discusses cloud computing and other hosting tendencies.
PeC: How do you believe the hosting landscape will change over the next five decades?
Engates: I believe we will see a good deal of new ways to break into the marketplace. We are going to see new technologies, new players, and new vendors coming to the market. Cloud computing is changing the landscape in a major way. The development of virtualization and cloud computing are making access to technologies more accessible to small companies. The cost of getting into an entry level ecommerce is going to become dramatically less costly. Things like hosting platforms which are multi-tenant and shared and equipped to support plenty of consumers at a lower price point make it easier for businesses to begin. We'll see a good deal of competition that will drive the cost down and make it better for the consumer.
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PeC: Please explain cloud computing.
Engates: Cloud computing is the buzzword that describes the way to deliver IT (information technology) infrastructure for a service using a utility pricing model. Merchants can purchase computing services and pay for them as they need them. They can buy storage or servers or whatever kinds of infrastructure services that they need for a brief time period. They do not pay for services or overhead they aren't using. So, when demand is high, they cover more services and when the demand declines, they cover for less. So, for businesses with a daily spike in the day or earnings that taper off in the day, merchants can purchase those computing services by the hour and then scale them up and scale down them. I believe this is especially vital for ecommerce companies because lots of them have seasonality in their enterprise. Another emerging area is cloud storage. It is possible to store content and images and information in the cloud for very low cost and serve it straight from the cloud so you don't need to build up that infrastructure.
PeC: How can you think software as a service (SAS) will impact smaller companies?
Engates: SAS is becoming a bigger and bigger piece of the IT landscape because people in business do not need to mess with IT. A good deal of small businesses need full-featured email services and cooperation services but they do not need to build up the infrastructure to run it . SAS can treat quite a bit of it now and I'd imagine that over time which will even expand. Rackspace hosts a whole lot of SAS businesses, so we see it as a fantastic way to offload some of your IT weight with someone else.
PeC: Please tell us more about your organization, Rackspace.
Engates: Rackspace started as a startup back in the 1990s and throughout the 2000s we actually grew fast. We are publicly traded now under the emblem of RAX. We have about 15,000 clients under our traditional hosting umbrella and over 45,000 servers under control. We host servers in eight data centers around the world, including two in San Antonio; one in Dallas; one in Herndon, Virginia; a few in London; and a fresh one in Hong Kong. We've got clients in probably over 100 countries, and we have close to 2,500 employees. Rackspace is small enough to actually get things done and large enough to have the wherewithal to perform them.
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