Rackspace Cloud Launches Reseller Channel Program

By Jessica Davis  |  Print this article Print


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Resellers buy cloud services from The Rackspace Cloud based on volume discounts starting at 4 percent for $2,500 per month and up to 12 percent for those buying $20,000 or more per month. The Rackspace Cloud also offers an affiliate track for those partners who prefer to refer customers.

The Rackspace Cloud, previously known as Mosso, has formally launched its first partner program with tracks for resellers and for affiliates.

The program offers volume-based discounts for reseller partners looking to offer their own service to end-customer companies, Jeff Omstead, director of cloud sales at The Rackspace Cloud, told Channel Insider.

"A lot of our reseller partners are focused on providing value to niche markets," he said. That is, they combine the cloud computing they buy from The Rackspace Cloud with specialized functionality that they add and then sell the whole package to their end customers. Those end customers buying such niche-packaged applications to compute stacks could include doctors or lawyers, said Omstead.

The volume-based discount ranges from 4 percent for those buying $2,500 or more worth of Rackspace Cloud services per month to 12 percent for those buying $20,000 or more per month. It’s an area that is garnering increased interest from resellers, according to Omstead. 

The Rackspace Cloud provides what channel partners need for reselling a hosted offering to make sense, according to Justin Santa Barbara, CEO at San Francisco-based FathamDB, a Rackspace Cloud reseller partner. FathamDB provides its customers with hosted MySQL databases.

"This is the channel model that has worked so well with non-cloud computing," Santa Barbara told Channel Insider. Big companies such as Microsoft cannot personally deal with each of their end customers. "They need resellers. That’s the model that has worked and has been very successful in the past."

And Rackspace Cloud offers resellers something that other cloud providers do not—a volume discount program, said Santa Barbara, who also works with Amazon's cloud offering. Rackspace Cloud's discount program is what makes it possible for resellers to resell the cloud plus their value-added services to end customers and still make a profit.

Santa Barbara envisions that ultimately many IT solutions providers will build functional offerings on top of cloud services and that end customers can mix and match those services a la carte, buying the functionality they need from a number of different providers—hosted database from one, Website from another and so on.

And that may happen soon, given the interest Rackspace Cloud has seen from resellers.

"We are seeing more and more interest from resellers each day regarding cloud computing," he said. "People are looking at how they can add to their businesses."

Partners can integrate additional applications to create their own offerings for end-user customers by writing to The Rackspace Cloud’s APIs. Chandler Vaughn, director of product development at The Rackspace Cloud, told Channel Insider that the integration is something that a typical reseller can handle in-house.

With the Rackspace Cloud reseller track, partners own the relationship with the customer. On the other side, the Rackspace Cloud affiliate program rewards affiliates for referring customers to The Rackspace Cloud with 5 percent of what is billed to the end customers each month.

The Rackspace Cloud includes a Web portal for tracking and reporting, Webinars, marketing collateral and opportunities for co-marketing, the company said. It also provides end-user billing and end-user support services to help partners streamline their own day-to-day businesses.

Jessica Davis covers the channel for eWeek and Channel Insider. Her technology journalism career began well before anyone heard of the World Wide Web and has included stints at Infoworld, Electronic News/EDN, and the Philadelphia Business Journal. Her work has also appeared on CNN and Forbes.com. She has covered hardware, software and networking, as well as the business side of technology. She has won several journalism awards, including a national ASBPE award for best staff-written column, and was named Marketing Computers hardest working tech journalist on their inaugural list of top tech journalists. Jessica can be reached at jessica.davis@ziffdavisenterprise.com

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