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Rackspace US, Inc.
Type Public Company
Founded 1998
Headquarters 9725 Datapoint Drive
San Antonio, TX  78229
Key people Richard Yoo, Dirk Elmendorf, Patrick Condon, Co-Founders
Morris Miller, Graham Weston, Executive Chairman
Lanham Napier, President, CEO
Industry Hosting
Website http://www.rackspace.com

Rackspace US, Inc. (dba Rackspace) is an IT hosting company based in San Antonio, Texas. The company also has offices in the United Kingdom and The Netherlands[1] and data centers operating in Texas, Virginia, the United Kingdom, and Hong Kong in late 2008. Email and Apps division of Rackspace operates in Blacksburg, VA.

Rackspace's support ideology - termed Fanatical Support - and team structures involve all "Rackers" (employees).



In 1996, Richard Yoo started a small ISP out of his garage apartment called Cymitar Network Systems in San Antonio, Texas. Quickly, this company began to provide application development work, in addition to basic internet access and web hosting. In 1997, Yoo brought on Dirk Elmendorf and the company formally began to develop internet applications as its primary business and a new company was formed called Cymitar Technology Group. As Cymitar Technology Group grew, Patrick Condon was recruited from California and joined the team in 1998. Coincidentally, all three were students at one time at Trinity University in San Antonio.

The pre-2008 Rackspace Logo
Although they began as application developers for end-users, they found that most companies didn't know how to host their applications, or didn't want to be involved in the hosting. They wanted to keep their focus on the application development - not the hosting - but they were unable find an opportunity to outsource the hosting work. Eventually, the three men realized that it would be better to make a product out of the hosting need, and launch it as a company. Rackspace was created and launched in October 1998 with Richard Yoo as its CEO. The beginnings of Rackspace's Fanatical Support started once Rackspace realized that no company at the time could fulfill their unique requirements. Most companies focused on the technology end of hosting, but much less on service and support. [2] On March 28, 2000, Rackspace received funding through Sequoia Capital. [3]

In January 2008, Rackspace went through a rebranding and changed from "Rackspace Managed Hosting" to simply "Rackspace". The company's tagline became "Experience Fanatical Support" rather than the older "Managed Servers Backed By Fanatical Support". The controversial campaign followed UKFast's high profile entry to managed hosting at the Internet World show 2007 in Earls Court, London, their strapline was simply "Experience".

The new logo and service marks keep the same colors as the original logo, but the overall design changed.

Business model

Rackspace has two main service level segments: Managed and Intensive. Both service levels receive support via the usual means - e-mail, telephone, and ticket systems - but they are designed to fit the needs of different businesses.

The Managed support level consists of "on-demand" support where proactive services are provided, but the customer is welcome to contact Rackspace when they need additional assistance.

The Intensive support 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.

Some services and products are only available for certain support levels. [4]

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 Networks, purchased ServerBeach in October 2004 for $7.5 Million. [5] Peer 1 entered the UK managed hosting market in January 2009 and the Server Beach brand now competes directly with the UK arm of Rackspace, run by Domonic Monkhouse ex managing director of Rackspace Limited. [6]

In October 2006, Mosso Inc. was launched, which experimented with white-labeling hosting services. [7] Eventually, the division became the foundation for Rackspace's current 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 Email and Apps division of Rackspace.

Recent news

Rackspace has moved their headquarters from a building once occupied by Datapoint Corporation to the 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 is purchasing 111 acres ({{rnd/bExpression error: Unexpected < operator|Expression error: Unexpected < operator|(Expression error: Unexpected < operator)|Expression error: Unexpected < operator}} km2) south of the mall to create a residential and retail complex. [8]

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. [9]

On August 8, 2008, Rackspace opened for trading on the New York Stock Exchange under the ticker symbol “RAX” after its initial public offering (IPO) in which it raised $187.5 million[10]. The initial public offering included 15,000,000 shares of its common stock at a price of $12.50 per share.[11] The IPO did not do well in the public market and lost about 20% of its initial price almost immediately.[12]


Rackspace claims to have a "Zero-Downtime Network" with a 100% uptime guarantee, however numerous downtimes have been reported:[13]

  • 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 have decided to make alternate plans at other hosting companies to avoid future problems. [14]
  • At around 12:35AM CST November 3, 2009, Rackspace experienced an outage for customers using their Dallas-Fort Worth data center - including those of Rackspace Cloud. [15]
  • At around 11:30am CST July 7, 2009, Rackspace experienced an outage for customers using their Dallas-Fort Worth data center. Reasons for the outage are currently unknown. [16]
  • At around 3:15pm CST June 29, 2009, Rackspace experienced an outage for customers using their Dallas-Fort Worth data center. Some customers experienced downtime for over 4.5 hours. [17]
  • At around 7:15pm CDT June 10, 2009, Rackspace experienced an outage for customers using their Dallas-Fort Worth data center while transferring power due to severe weather. While doing maintenance on the devices involved in the June 10 outage, Rackspace experience another power outage at 6:10pm CDT June 20, 2009 affecting the same customers. [18]
  • At around 7:40pm CST November 12, 2007, Rackspace experienced an outage for some of their customers due to a transformer exploding in a vehicle crash, which caused a partial power outage at the Rackspace data center in Dallas/Fort Worth.


On October 22 2008, Rackspace announced that it was purchasing cloud storage provider Jungle Disk and VPS provider SliceHost.


The company has clients worldwide, and an EMEA (Europe, Middle-East & Africa) division; which includes offices and data centres in the USA, United Kingdom, The Netherlands and Hong Kong.

Rackspace is registered in the UK as Rackspace Ltd., and employs around 400 people, at two offices (in Uxbridge, Middlesex) and rents three data centres (in and around London) as of 2008. The company opened a fourth UK data centre in Slough, Berkshire in the second quarter of 2008. Rackspace UK has appeared in The Sunday Times best companies awards 2007, and was in the top 50 UK workplaces as seen in the Financial Times.

A few well-known large organisations using Rackspaces UK hosting services include OnSpeed, Confused.com, The Army, Vue, Renault, online publication The Register, Funny or Die, Metacafe, Suicide Girls, and net connect.

Rackspace Benelux in Amsterdam opened its offices in October 2007. It has won several high-profile customers such as LogicaCMG, Exact Software and CapGemini.

See also


  1. "rackspace.com - About Us". http://www.rackspace.com/information/aboutus.php. Retrieved 2007-08-13. 
  2. "Web Hosting Interview - Rackspace Managed Hosting". http://www.hostsearch.com/interview/rackspace_managed_hosting_interview_october_2004.asp. Retrieved 2007-08-13. 
  3. "Edgar Online S-1A Filing". http://sec.edgar-online.com/2000/05/19/11/0000912057-00-025595/Section2.asp. Retrieved 2007-11-13. 
  4. "Managed and Intensive Service Levels". http://www.rackspace.com/solutions/services/comparison.php. Retrieved 2007-08-13. 
  5. "Peer 1 Buys ServerBeach for $7.5 Million". http://news.netcraft.com/archives/2004/10/06/peer_1_buys_serverbeach_for_75_million.html. Retrieved 2007-08-13. 
  6. "Peer 1 & ServerBeach enter UK market with ex-Rackspace MD". http://markets.hpcwire.com/jobbank/?GUID=8664941&Page=MediaViewer&Ticker=PIX. 
  7. "Mosso Leverages Utility Computing to Provide Complete Hosting Solution for Web Professionals". http://www.rackspace.com/information/mediacenter/release.php?id=130. Retrieved 2007-08-13. 
  8. "San Antonio approves boundary change for Rackspace". http://www.mysanantonio.com/business/stories/MYSA080207.rackspace.EN.d699cdf1.html. Retrieved 2007-08-13. 
  9. "Fortune Magazine: 100 BEST COMPANIES TO WORK FOR 2008". http://money.cnn.com/magazines/fortune/bestcompanies/2008/snapshots/32.html. 
  10. Rackspace IPO needed to cope with fast growth
  11. "Initial Public Offering - Press Release". http://www.sequoiacap.com/news/rackspace-prices-initial-public-offering/. 
  12. "Rackspace IPO tanks". http://bigtech.blogs.fortune.cnn.com/2008/08/08/rackspace-ipo-tanks/. 
  13. http://www.rackspace.com/whyrackspace/network/index.php
  14. "Rackspace Goes Down. Again. Takes The Internet With It. Again.". http://www.techcrunch.com/2009/12/18/rackspace-down/. Retrieved 2009-12-18. 
  15. "Downtime At Rackspace Cloud". http://www.techcrunch.com/2009/11/02/large-scale-downtime-at-rackspace-cloud/. Retrieved 2009-11-03. 
  16. "Someone Needs To Stop Tripping Over The Power Cord At Rackspace". http://www.thttp://en.wikipedia.org/w/extensions/UsabilityInitiative/images/wikiEditor/toolbar/format-ulist.png?0echcrunch.com/2009/07/07/someone-needs-to-stop-tripping-over-the-power-cord-at-rackspace/. Retrieved 2009-07-07. 
  17. "Yes, Rackspace Is Down And So Are Many Of Your Favorite Sites". http://www.techcrunch.com/2009/06/29/yes-rackspace-is-down-and-so-are-many-of-your-favorite-sites/. Retrieved 2009-06-29. 
  18. "Our servers have been down for 4 hours". http://twitter.com/shashark/statuses/2263488284. Retrieved 2009-06-21. 

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