This is another in a series of layoffs over the last year or two. They've tried to keep them relatively quiet.
They've reimagined the company as providing support on third-party platforms, namely AWS and Azure, instead of focusing on building, selling and supporting their own offerings. That model requires significantly fewer employees. That change, coupled with the buyout, means that there's no surprise in seeing layoffs at Rackspace, and there are likely more to come.
Private equality bought Rackspace out. Layoffs are part of that playbook. They basically pump cash in to grow sales, while cutting costs, so they can chop it up and sell it off for a multiple of what they paid for it.
> They've reimagined the company as providing support on third-party platforms, namely AWS and Azure
To be fair, Rackspace's market cap was only about 4 billion at time of acquisition. They don't really have the capital to get into a war with Amazon, Google, or Microsoft, when data centers cost hundreds of millions/billions to build.
The economies of scale they're fighting against are gigantic, so it makes sense to go towards supporting the clouds of other companies rather than building out their own bare metal.
It also requires very different types of employees
The sales engineer / presales architect working to design a cross-cloud solution for a customer is a very very different kind of "smart" from the Linux geeks that keep your systems running once they're deployed
Neither is better than the other, mind you - they're just different
I think it is important to note that Rackspace got into AWS and Azure services, because the dedicated physical servers business was dead man walking. While Rackspace did introduce virtualization and other services running on their own hardware, they would never be able to touch Amazon's industry sized scale.
My last Rackspace experience was awful. We signed with them because they said they had the ability to mitigate DDOS attacks. A competitor of ours was trying to push os of out business with downtime.
We told them the strength of the DDOS attacks and they said they could mitigate it. We signed a contract, got DDOS and we were null routed by them. I got to talk to one of their techs and they said they couldn't actually mitigate DDOS attacks of that strength. He told us to use DDOS Arrest which worked. So they lied about their ability to mitigate DDOS and were stuck with this expensive 2 year contract.
Then a month later our site went down for 48 hours, and it was because they had a dead router in their internal network, but they insisted nothing was wrong and I had to debug the issue myself to get them to find the issue.
My last experience with Rackspace was I think emblematic of their new direction.
They got into doing AWS consulting and sold the startup I was working for an AWS setup that was about 100x too large and overengineered for their static site.
Prior, I had used them for a number of projects and always found them to be professional and helpful. I think the old Rackspace is gone.
Thanks. I can't fathom why it's so hard to imagine people not knowing wtf local might mean. There were a bunch of aws admin rackers in SF. I wonder what happened to them.
We're using Rackspace Cloud Files. If they ever end up shutting down or something, what are our alternatives? We mainly use Rackspace Cloud Files CDN to deliver assets to our clients (JS, CSS, images).
Funny that AWS support is a growing business for them.
We actually gave up managed bare metal hosting with another provider for AWS a few years ago, when we found that AWS's automated infrastructure had reached a point wherein self-management was a viable option at a much lower cost.
Granted, our installation is straightforward, but overall, it seems AWS would reduce the need for managed services.
Speaking from an enterprise point of view, that makes all the difference. A lot of companies will have mishmashes of different systems with one-off setups that are not worth the effort of automating.
The main selling point of AWS, from an enterprise perspective, is to shift costs in the right balance-sheet column, lower build times, and lower headcount because you can cut the hardware boys. Everything else (automation etc) is entirely optional and only worth the effort in some particular circumstances.
All this hiring and firing makes me think that the economy should err towards gigs rather than FT employment.
i.e. Full-time work is only full-time until it ends, but the ending is inadequately spelled out on the side of management, so it becomes an ongoing expense drag, leading to diminishing returns.
Multiply this by the number of employees, layoffs seem inevitable.
"All this hiring and firing makes me think that the economy should err towards gigs rather than FT employment."
The danger of this (to the employees) is a recession creating another 2009-like economy, where the best one could hope for is a contract gig of more than a couple of months. People tend to forget how disposably they can be treated during hard times.
We've been with Rackspace since 1999, but I'm getting concerned about the future of the company. Can anyone recommend a comparable managed host for Windows?
I don't have services like Pingdom or Pager Duty for my sites. I have Rackspace. If a site goes down, they immediately attempt to recover it, acting within the account rules I set up with them. If that fails, I get a phone call from an expert and we troubleshoot together.
I once got a call that one of my servers had started sending out a high volume of email. When I took the call, Rackspace folks had already found the nasty script doing it and just needed my ok to take the site down for a few minutes to boot it.
The service is really great. But, it ends just below the application layer, and these days, that's where most of the problems show up. So I am looking at moving off of Rackspace, but I'm looking up the service ladder at application-aware hosting services like WP Engine or Pantheon. As opposed to down the service ladder, to a self-service "don't call us" system like AWS or Google.
Coming from a previous Rackspace customer (over 10 years), I wouldn't at this point. AWS cloud offerings are superior to Rackspace cloud and LiquidWeb dedicated servers are much more cost effective with decent support.
Their support used to be the best in the business and we were willing to pay a premium for that but even their support started to suffer starting early 2015.
It is unfortunate because Rackspace was an amazing partner to our business for a long-time, which made it a very hard choice when we decided to move on.
I was there years ago but the main reason was support. I worked on the Enterprise/Custom (largest clients, minimum 5 figure MRR/month) team and the phones were staffed by actual System Engineers/Admins 24/7. It might be one guy overnight but if you were the CTO of $bigname and needed something done, from SQL restores, migrations, etc all you had to do was dial in. No phone tag, no wait, no voicemails.
We were very expensive but the companies must have saved money in hiring their own Engineers as were always growing.
AWS/GCP/Azure have made doing a lot of what we used to do incredibly more accessible to more people.
You don't. I just moved a WP multisite from Rackspace Cloud to AWS. Load times down 50%. Cost down 90%. Hosting is not, and has never been, an easy business.
Speaking as a Rackspace customer, if any of these guys are Linux techs, and you're looking, hire them. With signing bonuses.
Anecdote: A couple years ago, I had one explain to me (in a way that made sense) how the battery on the raid array was probably the cause of some problems with https. And _he was right_.
Maybe not everyone there is a certified genius, but that really blew my mind. They really know hardware. I haven't talked to one who couldn't save my tail in a pinch. Rackspace might seem a bit on the expensive side, but their support is absurdly good.
Former Racker here, while I wouldn't agree all of their techs are amazing, what I liked about working there was the vast amount of knowledge spread between teams - coupled with Texan kindness and hospitality. Generally speaking any answer I needed I could get from a phone call or a few IMs.
Working there was a great learning experience, and I met a ton of super intelligent, motivated people from the Austin office.
But, all good things come to an end. Early 2015 I noticed talent being pushed towards newer offerings (e.g. Azure support), which made the typical, aging, "Linux support for small to medium business on bare metal machines" not so 'fanatical' anymore. People started to jump ship because the force behind the changes. It was a tough transition and probably still is; so I'm not really surprised that the layoffs are continuing.
In any case, I appreciate your compliment and I'm glad you have had a good time with the company.
I was a previous Rackspace customer for over 10 years and at one time had 9 dedicated servers with them. Their Linux techs were top notch. IMO you are smart to want to obtain some of them.
Unfortunately stating in early 2015 the support started to deteriorate. That coupled with the cost we were paying for their dedicated servers/fanatical support stopped making since.
I used them for email for a while and I couldn't get my mail client to connect (Airmail, first gen). The guy on the phone spent hours with me and even purchased a copy of the app just to see if it would work for him. I don't remember what ultimately fixed it but I got it working - and it wasn't even a rackspace problem if I recall correctly. Still impressed by how far they were willing to go to help a customer.
I agree. Their support is always really great. Was the battery causing the time to drift or something, so that the SSL stuff saw the wrong time & broke? Just wondering how a battery could mess that up!
Reading this makes me realize how naive I was. I thought I could rent a cheap dedicated server from OVH and leverage Docker to build nice infrastructure without paying too much. Better staying with Google/AWS then.
> “We were very intent on preserving as many Racker positions as possible in our customer-facing roles, and we’re confident we are not going to affect fanatical support for our customers,” the spokesperson said.
[+] [-] AlexB138|9 years ago|reply
They've reimagined the company as providing support on third-party platforms, namely AWS and Azure, instead of focusing on building, selling and supporting their own offerings. That model requires significantly fewer employees. That change, coupled with the buyout, means that there's no surprise in seeing layoffs at Rackspace, and there are likely more to come.
I'm a former Racker.
[+] [-] godzillabrennus|9 years ago|reply
[+] [-] jimmywanger|9 years ago|reply
To be fair, Rackspace's market cap was only about 4 billion at time of acquisition. They don't really have the capital to get into a war with Amazon, Google, or Microsoft, when data centers cost hundreds of millions/billions to build.
The economies of scale they're fighting against are gigantic, so it makes sense to go towards supporting the clouds of other companies rather than building out their own bare metal.
[+] [-] warrenm|9 years ago|reply
The sales engineer / presales architect working to design a cross-cloud solution for a customer is a very very different kind of "smart" from the Linux geeks that keep your systems running once they're deployed
Neither is better than the other, mind you - they're just different
[+] [-] samplonius|9 years ago|reply
[+] [-] andrew_wc_brown|9 years ago|reply
We told them the strength of the DDOS attacks and they said they could mitigate it. We signed a contract, got DDOS and we were null routed by them. I got to talk to one of their techs and they said they couldn't actually mitigate DDOS attacks of that strength. He told us to use DDOS Arrest which worked. So they lied about their ability to mitigate DDOS and were stuck with this expensive 2 year contract.
Then a month later our site went down for 48 hours, and it was because they had a dead router in their internal network, but they insisted nothing was wrong and I had to debug the issue myself to get them to find the issue.
[+] [-] michaelbuckbee|9 years ago|reply
They got into doing AWS consulting and sold the startup I was working for an AWS setup that was about 100x too large and overengineered for their static site.
Prior, I had used them for a number of projects and always found them to be professional and helpful. I think the old Rackspace is gone.
[+] [-] debt|9 years ago|reply
[+] [-] mavelikara|9 years ago|reply
[+] [-] snug|9 years ago|reply
[+] [-] true_tuna|9 years ago|reply
[+] [-] neom|9 years ago|reply
RS will do really well as a services business, lots of fortune business that need to migrate to software-defined infrastructure.
[+] [-] ourmandave|9 years ago|reply
http://ius.io
Which, while not officially supported by Rackspace, was started there, is sponsored by, and is currently maintained by them.
[+] [-] VeejayRampay|9 years ago|reply
[+] [-] leesalminen|9 years ago|reply
We're moving a lot of files over to Google Cloud Storage (Nearline) as well as full backups to Coldline storage.
Nearline storage is 1/10 the cost of cloud files. Lifecycle policy is very handy for automatic file rotation. Command line is slick.
Rsync was a total lifesaver in the migration. Moved 4TB of files over 26 ish hours.
[+] [-] unclebucknasty|9 years ago|reply
We actually gave up managed bare metal hosting with another provider for AWS a few years ago, when we found that AWS's automated infrastructure had reached a point wherein self-management was a viable option at a much lower cost.
Granted, our installation is straightforward, but overall, it seems AWS would reduce the need for managed services.
[+] [-] toyg|9 years ago|reply
Speaking from an enterprise point of view, that makes all the difference. A lot of companies will have mishmashes of different systems with one-off setups that are not worth the effort of automating.
The main selling point of AWS, from an enterprise perspective, is to shift costs in the right balance-sheet column, lower build times, and lower headcount because you can cut the hardware boys. Everything else (automation etc) is entirely optional and only worth the effort in some particular circumstances.
[+] [-] danm07|9 years ago|reply
i.e. Full-time work is only full-time until it ends, but the ending is inadequately spelled out on the side of management, so it becomes an ongoing expense drag, leading to diminishing returns.
Multiply this by the number of employees, layoffs seem inevitable.
[+] [-] DrScump|9 years ago|reply
The danger of this (to the employees) is a recession creating another 2009-like economy, where the best one could hope for is a contract gig of more than a couple of months. People tend to forget how disposably they can be treated during hard times.
[+] [-] flukus|9 years ago|reply
[+] [-] hoodoof|9 years ago|reply
Expect them to close/sell their cloud hosting division.
[+] [-] tostitos1979|9 years ago|reply
[+] [-] locusm|9 years ago|reply
[+] [-] Rapzid|9 years ago|reply
Lanham never would have missed the opportunity to drop "fanatical" in.
"The company is cutting jobs in its corporate administration and management teams."
Sounds like they are not releasing technical and customer facing talent?
[+] [-] dbg31415|9 years ago|reply
[+] [-] esw|9 years ago|reply
[+] [-] samstave|9 years ago|reply
[+] [-] snowwrestler|9 years ago|reply
I don't have services like Pingdom or Pager Duty for my sites. I have Rackspace. If a site goes down, they immediately attempt to recover it, acting within the account rules I set up with them. If that fails, I get a phone call from an expert and we troubleshoot together.
I once got a call that one of my servers had started sending out a high volume of email. When I took the call, Rackspace folks had already found the nasty script doing it and just needed my ok to take the site down for a few minutes to boot it.
The service is really great. But, it ends just below the application layer, and these days, that's where most of the problems show up. So I am looking at moving off of Rackspace, but I'm looking up the service ladder at application-aware hosting services like WP Engine or Pantheon. As opposed to down the service ladder, to a self-service "don't call us" system like AWS or Google.
[+] [-] 20years|9 years ago|reply
Their support used to be the best in the business and we were willing to pay a premium for that but even their support started to suffer starting early 2015.
It is unfortunate because Rackspace was an amazing partner to our business for a long-time, which made it a very hard choice when we decided to move on.
[+] [-] swozey|9 years ago|reply
We were very expensive but the companies must have saved money in hiring their own Engineers as were always growing.
AWS/GCP/Azure have made doing a lot of what we used to do incredibly more accessible to more people.
[+] [-] ronilan|9 years ago|reply
[+] [-] chx|9 years ago|reply
[+] [-] devopsproject|9 years ago|reply
customer support
[+] [-] danjoc|9 years ago|reply
Anecdote: A couple years ago, I had one explain to me (in a way that made sense) how the battery on the raid array was probably the cause of some problems with https. And _he was right_.
Maybe not everyone there is a certified genius, but that really blew my mind. They really know hardware. I haven't talked to one who couldn't save my tail in a pinch. Rackspace might seem a bit on the expensive side, but their support is absurdly good.
[+] [-] keyboardhitter|9 years ago|reply
Working there was a great learning experience, and I met a ton of super intelligent, motivated people from the Austin office.
But, all good things come to an end. Early 2015 I noticed talent being pushed towards newer offerings (e.g. Azure support), which made the typical, aging, "Linux support for small to medium business on bare metal machines" not so 'fanatical' anymore. People started to jump ship because the force behind the changes. It was a tough transition and probably still is; so I'm not really surprised that the layoffs are continuing.
In any case, I appreciate your compliment and I'm glad you have had a good time with the company.
[+] [-] 20years|9 years ago|reply
Unfortunately stating in early 2015 the support started to deteriorate. That coupled with the cost we were paying for their dedicated servers/fanatical support stopped making since.
[+] [-] neom|9 years ago|reply
[+] [-] mikeash|9 years ago|reply
[+] [-] dawnerd|9 years ago|reply
[+] [-] backwardm|9 years ago|reply
[+] [-] dvnguyen|9 years ago|reply
[+] [-] gourneau|9 years ago|reply
[+] [-] DrScump|9 years ago|reply
[+] [-] OJFord|9 years ago|reply
What a bizarre comment! 'Fanatical'?
[+] [-] afarrell|9 years ago|reply
[+] [-] unknown|9 years ago|reply
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