Slicehost

We want to make you aware that beginning in September, due to a change in our underlying subscription arrangements with Red Hat, we can no longer offer a daily pro-rated billing option for RHEL instances. Slicehost customers will be billed for RHEL instances on a monthly rather than pro-rated daily basis.

However, the total cost of service for most RHEL customers will likely go down under the monthly billing model.

Both Rackspace Cloud and Slicehost will begin charging RHEL customers a monthly $20 licensing fee. This license fee won’t be prorated, so every Slice you spin up with RHEL will be subject to a full month’s license fee.

What this means for Slice customers:

• Instead of being billed for your RHEL license on a pro-rated daily basis, customers using Red Hat will be billed on a monthly basis (normal monthly billing cycle).

• The Slice itself will continue to be billed on a pro-rated basis - this only affects the RHEL license.

• The new fee for RHEL has been reduced to $20 per month per Slice.

• Every Slice you spin up with RHEL will be subject to a full month’s license fee, no matter how long you use it. If a Slice with RHEL is running for any portion of a month, then you will be billed for that month’s license fee.

Thank you for your understanding as we shift to monthly billing for RHEL users. If you would like help understanding how this might affect your personal usage please feel free to submit a ticket via the SliceManager, email us (support@slicehost.com) or pop into chat 24/7.

Imagine a world where code used by the biggest clouds is freely available to any developer, anywhere. A world where that code was a standard used to build private clouds as well as a variety of new service offers. In this world, workloads could be moved around these clouds easily - you could fire your cloud provider for bad service or lack of features, but not have to rewrite the software to do it. Imagine an open source cloud operating system that lifts IT to the next level of innovation, just as Linux drove the web to new heights.  

Today, we at Rackspace launched an ambitious project called OpenStack that aims to make this new world a reality.

I want to lay out the thinking that got us here and why we think this moment will change computing forever.  

"The cloud" at its most fundamental level is all about a massive supply increase in computing power. The PC era was all about putting a computer on every desk. The cloud era goes a step further, putting the power of supercomputing at the literal fingertips of every individual at anytime.  Whether it's enabling a youth soccer coach to schedule practice across the online calendars of 18 families, or helping a scientist fold proteins to design new cancer drugs, or encouraging a frontline employee to instantly and cheaply test a new marketing campaign, the exponential growth in computing power and applications is changing every corner of our economy and society. And, this era is truly just beginning. We have seen only a tiny fraction of the potential gains that arise from cheap, ubiquitous computing power.  

As this landscape has evolved, some have dismissed cloud computing as just a return to the mainframe era. This view is fundamentally wrong.  Mainframes were available to only the smartest employees at the richest companies. The cloud is accessible to all, and usable by anyone, at low cost. Its ubiquity is the source of its power.

However, there is one area where mainframe concepts are intruding into the cloud - the vertically integrated technology stack. As hardware and software merge into services, the danger of locked down proprietary software stacks are emerging in the cloud space. The cloud world changes everything, and that is not good to many entrenched interests of the old guard. Core technologies from operating systems to hypervisors to databases are being used to tie cloud customers into an integrated view of the world.  

If the web has taught us anything, it is that open systems, portability, and choice drive innovation. The open Linux system brought us a mountain of software and tools to help accomplish almost any task. And, each component, whether a database or a widget could be moved in and out freely based on the job getting done.  

We at Rackspace have long talked about an "open" cloud. And as a service provider built on our Fanatical Support difference, we have never had an interest in creating technical walls around our service. But, given that no standards tools have emerged to build massively scalable clouds, we too have had to build custom software that creates some level of wall around our cloud offerings. For months we have debated how to drive greater standards and increase the velocity of cloud technologies in general. We finally converged on the obvious answer:  open source our cloud technology.

Today, we announced a new open source project that includes those core technologies: OpenStack.  And, we are not alone.  As we looked at all the projects that already existed to drive standards we saw that other efforts were underway that complemented what we have done. We saw a ton of promise in the Nebula computing project built by NASA and are making it a core part of the project.  Taking the contributions of Rackspace and NASA as a starting point, OpenStack forms a powerful foundation of technologies including, a scalable compute provisioning engine - OpenStack Compute - and a fully distributed storage engine - OpenStack Object Storage.  

The community, which we plan to actively support and drive, is live today at openstack.org with code available for download.  

Last week we assembled a strong group of cloud community leaders and developers to meet and review the architecture, engage on technology direction and contribute code. The effort attracted more than 100 participants from 25 companies including hosting companies, telecom providers, hardware manufacturers, cloud ecosystem companies and beyond. This enthusiasm and collaboration around OpenStack has laid the foundation for a vibrant and innovative approach to building the core software to power the future cloud world. 

What do we expect OpenStack to mean for the cloud community? Some pretty major things. One, anyone will be able to run this cloud and do it anywhere. Enterprises and governments will be able to build private clouds. Service providers will have the same technology used by Rackspace and NASA to build new offers. Choice and portability are inevitable in this world. Two, the whole tech ecosystem can build around this foundation. With wide adoption, there will be a market for new services all around this core engine. From storage systems to monitoring tools to management systems, there is no end to what can be attached to the core project. Three, the cloud will advance faster than ever. Between just NASA and Rackspace, an army of developers are committed to the continued advancement of OpenStack.  With our emerging supporters in the project, we expect to dramatically expand that army. Finally, a core set of standards will be freely available and totally open. New technologies can be attached. Better solutions will be driven into the product. And, the use of this powerful technology will not tie you to the use of any other technologies.

For our customers, we think there are many benefits that flow from these community gains. Not only will this help our offers develop faster and more transparently, but our customers can run private editions of our core systems in house or in our managed hosting operation.  

We could not be more excited about the launch of this project and the enthusiasm around it. As a company that has invested a great deal in the development of cloud technologies, we did not take the decision to open source lightly. We think this decision will serve our interests and those of our customers. While we at Rackspace hire top developers and engineers to make sure our technology is second to none, seeking a technology advantage has never been our approach.   We have our own vision about how to deploy this technology and serve customers - by giving them seamless access to scalable computing with the trusting partnership that comes through Fanatical Support. But, there will be many approaches and winning formulas. We think by welcoming those approaches and driving standards and more rapid innovation we will all win.  

We hope you join us in this cause. We know there are many parties who might want to join us in the effort, please reach out to us.  

We look forward to updating you as we make progress.

Author: Lew Moorman - President, Cloud and Chief Strategy Officer

Credit cards are the only form of payment we accept and occasionally this causes problems for customers (usually international). Paypal is the most often requested alternative and it looks like they have a new solution that could be of interest to our customers. They are set to announce a virtual credit card product tomorrow which generates a usable Mastercard number that deducts directly from your Paypal account. Initial reports describe this as an installed software package that works with your browser, so compatibility with OS X and Linux remains to be seen. However, it could be a great one-time payment option for folks who’d prefer to setup a Slicehost account without using a credit card.

It’s super quiet around here. You know what that means right? The wheels are turning, code is being slung and we’re working on goodies. More to come, but until then we wanted to point everyone to our new jobs page. We want sharp, dedicated people in support, operations and development. Sound like you? Then come with us.

Forbes magazine ranks St. Louis #14 on the list of best cities for young professionals. Not a bad place for gobs of virtual servers either ;-)

A very high share of the best 400 big businesses and best 200 small businesses call St. Louis home. In that measure, it ranked sixth. In attracting the cream of the graduate crop, it clocked in at 16th. The never-married population was good for 24th, and salary to cost of living hovers right around the national mean.

Listen up ye RAM starved coders, the 2048slice has arrived. We mentioned the 2gig Slice on last week’s podcast and rolled them out over the weekend. This new package is in response to your demands, which began trickling in early this year and now are regular requests.

What might you do with a 2gig Slice?

• Upgrade your 1024slice and double storage, bandwidth and CPU time
• Use it as a big, bad database server
• Migrate apps from expensive dedicated servers

This will certainly help the 1gig folks who have been pleading for expansion options. And we feel this a real alternative for those running apps on dedicated servers, since you get a big chunk of CPU and RAM at a solid price. Might a 4096slice be around the corner? Hmmm ;)

A load of feedback came in on our cashflow post. The majority of comments at the blog and forum are on board with a 3-month prepayment for new signups. Several folks also expressed a desire to pay more to move up in line. Over the weekend, we implemented a new wait list format and signup page which we hope is fair to everyone:

• new signups will require a 3-month prepayment
• if you cancel before the first month, we’ll refund your prepayment minus the first month’s cost. Just like before, the commitment is one month.
• the wait list will be ordered by prepayment term, then signup date. What this means: longer prepayment term = better wait list position.
• Prepayment terms: 3 months (default), 6 months, 12 months, 24 months – 10% bonus for annual prepays
• wait listers receive an email with a link to a status page that includes a time estimate. On this page, you can modify your prepayment term to improve your position (if needed).
• everyone who signed up in March has immediate priority. If you signed up in April, the prepayment term will affect your position.

That covers our new process. The good news: this setup should help everyone get a Slice faster – and that was the goal. Again, we truly appreciate the dialogue on this issue. It gave us an excellent feel for what people would be open to and new thoughts as well. So please do continue, let us know if this works for you.

PS – if you are already on the wait list, you’ll get an email soon with a link. No need to add your name again.

The last time we talked, it was about the wait list. The feedback was awesome and we thank everyone for hanging around to get their hands on a Slice. The list has continued to grow rather quickly, as I’m sure new customers noticed. We’ve been working for several months to address this delay, with limited success. It’s a moving target, both customers and demand continue to grow. We’ve talked extensively with banks/lenders and due to the nature of this business have run into obstacles. At the same time, we’ve explored venture capital. It’s a long cycle and there are strings attached to VC gold :)

We started brainstorming how to hack our cashflow. We love what we do, we love the community growing around our service and we love helping you solve problems with our platform. The wait list is slowing all of that down.

Ideas bounced around:

• raising prices – hate it. We feel our prices should be falling, not rising.
• Slice free market – cool idea that would set an accurate price point. Kind of complex, we want signups and expansion to be simple.
• lifetime accounts – has some pitfalls, such as upgrading Slices. We might suck in 5 years ;)
• selling stock to customers – another neat idea, but lots of legal junk involved.
• setup fees – hell no we won’t go!

One idea with minimal impact to our current scheme: new signups would be billed for 3 months. After that initial period, billing would switch back to monthly. Existing customers would not be affected. In time, the new billing style should help us get ahead of the growing demand curve. We couldn’t have taken this approach last year, given that we were an unknown. Now however, we are proud of our reputation and what our customers say about Slicehost.

We want to solve this problem ASAP. Jason and I have tons of cool stuff planned (new toys later this week), but are increasingly wasting time pursuing financing options. We’d rather be coding.

Current and future customers, please give us your thoughts:

• Does this plan make sense?
• Would it turn you off to our service?
• Other ideas or concerns?

We feel our community is the best asset Slicehost has to offer. Let’s put that brainpower to use and design a plan to fuel its growth.

In speaking with a customer last week, I realized that the wait list might seem mysterious or frustrating for new users. The speculations we’ve heard from folks: our vendor can’t deliver, we’re out of space, not enough man power, going out of business – the list goes on. Well, it’s really nothing dramatic, here’s the scoop.

We’ve been growing super fast since our launch, which is fantastic. And since then, we’ve tried our best to keep up with demand and for the most part have done so. However, hosting is a very capital intensive business. Especially so for us, because our underlying technology prevents overselling. For every person coming on board, there is a Slice deployed and dedicated. Since many of you are business owners yourselves, a word near and dear to your heart is something we manage daily: cashflow. We’re a small, self financed company, purchasing a tremendous amount of expensive hardware, located in expensive data centers. The demand keeps increasing and we simply can’t add the resources fast enough while continuing to service existing customers who are adding Slices and upgrading all the time.

Now I know what you’re thinking: leasing, loans, venture capital, that black American Express card, the lottery. Well all of those options are being explored, some of them more successfully than others. If you have any leads or wealthy relatives, let us know – seriously :) But these are slowwwww processes.

Ultimately it just means that new users probably won’t get a Slice the second they are ready to sign-up. We always have a pool of Slices on hand for existing customers to add and upgrade since they are a priority, but new users have to be throttled as we purchase and deploy new hardware. It’s great that so many folks want to join our community and we’re growing as fast as possible. So please be patient with us, we’ve got the elves working round the clock and UPS dropping servers off weekly . Currently the wait list is about 2 weeks deep and we’ll keep the ETA updated on the reservations page. We hope you can hold out, it’s worth the wait!

One of our most frequent customer requests has been the ability to pay annually or make a one-time payment. It’s really handy for international folks who must approve a charge through the bank, businesses that prefer one-time payments or standard billing cycles, single use credit cards and people with multiple Slices.

What’s in it for you? Payments greater than $250 receive a 10% account bonus. This translates directly into free months or additional services. Customers with several Slices or those who prefer 1 or 2 year prepayments score a nice discount.

We hope this makes life a little easier. You can reach the prepayment page under the Account tab in SliceManager, just select Recent Payments. Let us know if you have any questions.

Sheesh – Slices are flying off the digital shelf. We’ve put new signups on hold until Saturday. Sorry for the delay.

Our sincerest apologies for the network otuage this afternoon (1130-1230CST). A full report will follow here and the the forums. Also some clarification – this was just network related, Slices were fine.

If you need a Company/Organization name on your invoices for tax purposes, you can add this information in the Account tab of SliceManager. Hope this helps with the bookkeeping, let us know if anything else would make life easier.

One of our early customers is posting about decisions and lessons learned while running their startup – ProductCritic. The first post talks about choosing a VPS over a dedicated server.

But one of the greatest reasons to use a VPS is because it allows you to grow your hardware needs as your site grows. Instead of investing thousands into your own dedicated server and that is basically just going to sit idle 99% of the time you rent a slice of the size needed for your site. This is less expensive, more flexible and very cost effective. Zero upfront costs and very low monthly costs.

Link

We’ve had a few customers inquire about bulk Slice purchases for various reasons including: classroom use, virtual infrastructure, load balancing and more. These are all great ideas. For businesses, considering a cluster of Slices for server consolidation makes even more sense. Check out this stat:

We estimate conservatively that for every workload moved from a physical to virtual environment, customers can save about $290 in electricity costs, and about $360 a year in cooling costs. The more important thing is that these savings accrue year after year.

Wow! Let us know if you’re interested in a bulk purchase and we can put something together for you. With skyrocketing cooling and data center costs, there’s never been a better time to consider virtual server consolidation.