Rackspace, OpenStack, and How Texas Is Driving The Cloud Computing Market

Enterprise software may not be the sexiest area for technology news, but it's been the source of some of the biggest IPO and M&A successes in the last year or so in the technology industry. It's also one of the key parts of the high industry here in Texas. So it's no surprise that the state is also behind the move towards cloud computing, thanks to companies such as Rackspace (, the San Antonio company which also has been a key part of the open source, OpenStack cloud computing effort. We talked with John Igoe, the VP of Private Cloud at Rackspace--and former Dell executive--on how Rackspace, and Texas, is behind the industry's move to the cloud.

First, for those not familiar with what Rackspace is doing in the cloud area, can you talk about what the company is doing?

John Igoe: Rackspace, as I'm sure you know, is a really innovative place to work. It's a place that has developed a reputation for thought leadership in servers, operations, and management of cloud computing environments. Of course, they also hae a legacy around managed hosting, which has lent itself to developing some of the key technology an dprocesses which helps customers, particularly enterprises, take advantage of the methodology of things like DevOps, and things like OpenStack, and also how to migrate from your legacy infrastructure environment to a cloud environment. In particular, around open source and OpenStack. It's a very exciting place to join. If you go around the world, and someone brings up cloud technology and cloud strategy, and how to operate the cloud--Rackspace is always mentioned in those conversations. I'd known Rackspace for a number of years, as I was deeply engaged in OpenStack, and a member of the OpenStack Foundation board.

How did you decide to move over to Rackspace from Dell?

John Igoe: I had joined Dell, which is another great company, about five years ago, when I sold my startup to Dell. My startup company delivered software technology which was a remote management platform, in a software-as-a-service format, to partners such as managed service companies and IT infrastructure. If you think about that statement, that's very close to what Rackspace has always done. We had alignment in the industry, and where we see the industry going. I formed my company about the same time as Rackspace was formed and was building out their business. When I sold my company to Dell, I started engaging with Rackspace on the OpenStack initiative. I was the executive sponsor at Dell, and built out their private cloud offerings. We had partnered with Rackspace on that. Our mutual vision of the industry came together.

However, I'm a startup oriented guy, and that's what I've done for most of my career. When I was thinking of leaving Dell, I wanted to continue to work on a couple of things. First, was the cloud, and the second, was on OpenStack, to use open source to disrupt the industry, so that customers could receive the benefit from the technology and services. There's a very short list of companies I would consider going to, which have the attributes of a startup, the attributes of innovation, disruptive approaches to the industry, and the last one, which is the most important, is customer focused.

The theme around fanatical support at Rackspace matches my own goal, of using technology, combined with dedication, to make customers successful. I was very pleased to be able to join Rackspace. You literally only get one or two opportunities in a career to participate in a startup, to participate in a company that already has 1 billion in revenues, and can still move as a startup can. I couldn't pass it up.

Speaking of OpenStack, where's the tipping point going to be for it to really take off?

John Igoe: I think OpenStack is going through tipping points every year, since it's been founded. Right now, we're at a different tipping point. I think the first, was if industry would adopt OpenStack, two years ago. I think that with Rackspace and NASA's leadership, it really exceeded the expectations of the people involved with it. I remember sitting with Jim Curry in San Antonio, and trying to figure out which industry leaders we had to convince about OpenStack and get them aboard. We were able to get all of those people involved, and even more people from the industry came on board. That industry support was critical for our first year of success. The second and third year, where we are now, have been different, in that initially it was all about developers, and at the conferences now, it's about end users. The scope and demographic of the people attending our conference has changed, and with the recent one in Portland, the presentations were form end users who are actually pushing OpenStack into production, and who have had OpenStack in production for some time.

Where does OpenStack belong in a world that currently is dominated by Amazon?

John Igoe: The differentiation here, is that OpenStack technology is driving an initiative, throughout the world, which can be adopted and molded in a non-proprietary way. If you, as a user, want to integrate some proprietary technology into OpenStack, you can do that very easily. It's basically an open system. The companies and brand names you trust are there to make sure the technology works in a reference architecture. The second part, is there's been a real shift in the industry about how end users are viewing their IT assets. They want to manage and deploy them using a hybrid model. In the hybrid model, they want assets and IT infrastructure in their own environment, but also want to be able to take advantage of the public cloud, and take advantage of traditional, managed hosting. Many end users come to us saying we have X number of data centers, and we don't want any more. They want to put their new workloads in our data center. But, they have to be able to talk to workloads in their legacy data centers. With technology like OpenStack, it's really built, and designed for a hybrid cloud computing environment. One reason I joined Rackspace, is because Rackspace has already installed customers in each of those models. RackSpace has a hybrid technology, RackConnect, which implements integration of workloads across both public and hosted environments. That's a great differentiation between Amazon Web Services and OpenStack. That said, I think both are viable, and will be viable in the industry for the next ten years. However, customers are going to make a choice of what to use based on their own needs.

How does Texas figure into Rackspace's plans?

John Igoe: I think it's critical to what we're doing. Texas itself is one of the things that attracted me to move to RackSpace. I'm actually a Boston native, and have lived there for 30 years. I'm now relocating down to San Antonio, because it has an entrepreneurial spirit, the investment in the community, and the response that I'm getting and that I'm seeing in the marketplace around San Antonio, as well as around Austin. Many people don't realize we have a big office there. The business culture in Texas is critical, and we're aggressively looking to attract entrepreneurial, innovative people. Those are the types of people we want to hire. I also think the sate itself is a very attractive place to live, and to raise a family. To give you an example, I have kids who recently graduated from college, and they found out I was going to move here, so they're now asking what kinds of jobs there are here, because they also would love to live in the San Antonio or Austin area.