Rackspace: Shared Hosting on Borrowed Time

Is cloud computing a theat or opportunity for the hosting industry? At HostingCon major cloud providers discussed their visions for the future of hosting and how it impacts traditional shared and dedicated hosting providers.

Rich Miller

August 17, 2009

3 Min Read
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There's nothing like telling a room full of executives that their business is in imminent peril to get people's attention. At HostingCon last week. Rackspace Cloud general manager Emil Sayegh predicted that cloud computing will bring major change for the web hosting industry. "Over the next for five years, shared hosting as we know it will be made obsolete by the cloud," said Sayegh. "I firmly believe it. What we need to think about is an environment in which cloud computing and dedicated servers coexist."

The web hosting industry has heard this type of warning before. During last week's keynote panel on cloud computing, HostingCon attendees heard the leading players in cloud computing deliver various flavors of the same message: the world is changing, and the cloud will disrupt business as usual in the web hosting industry.

On one level, the presenters from Rackspace, Microsoft, Google and Salesforce.com were technology evangelists preaching to a somewhat skeptical crowd. On another level, they were pitching a crowd of potential customers. Each of these players envisions hosting companies playing a key role in transitioning customers onto their platforms.

"Our cloud platform is built from the get go as a reseller platform," Sayegh said, noting the origins of the Mosso platform, now the Rackspace Cloud. "Reselling cloud hosting can be done very easily. My advice for shared hosters is to look for something that tastes and looks like what you're doing.

"The transition needs to start with experimentation," he added. "It's easy and cheap to try out."

Google's Stephen Cho noted that his company, which has often been viewed as a competitor to hosting companies, now has a reseller offering. "We provide a Google apps offering for service providers to provide to customers," said Cho. "It's an unprecedented new level to which applications can now be delivered directly to the consumers."

As often happens, different cloud providers were discussing offerings at different levels of the cloud computing "stack" that offers infrastructure, platform or software as a service.

MIcrosoft's Zane Adams touted the developer-friendly nature of the Windows Azure platform, while Daniel Burton of Salesforce.com emphasized the importance of its multi-tenant software as a service offering. "We cannot have cloud computing unless you have a multi-tenant architecture," said Burton. " Security is definitely important, and that's the strength of multi-tenancy. This stuff is not easy. This is really, really, really hard to do. Multitenant architecture is hard to do, but when you get it right, it's magic."

The difference is significant, since some hosting companies have strong developer teams, and others focus on marketing.

While the panelists all view cloud computing as a disruptive trend for hosting companies, not all see the cloud putting segments of the hosting market out of business.

"Dedicated hosting is not going away, much as we wish it would at Salesforce," said Burton.

Cloud computing "is a tool set," said Google's Cho. "I think it's a mistake to think about all wholesale switch from one to the other. We're talking about 'either or' and I think it's 'both and.' There is a transition of applications, some of which lend themselves more naturally to a cloud, some which do not. I think people should make cost customer decisions rather than technology decisions."

"Transitions happen. They're not binary, on and on," said Microsoft's Adams. "We can't walk out of here in the morning and everyone's on the cloud."

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