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Rackspace Cloud Reality Check: In-House IT Still Chained to Server Management

LONDON, March 29 — A new survey released today by Rackspace Hosting, the service leader in cloud computing, reveals that IT teams from mid-sized UK and US businesses polled still spend over half (56 percent) of their time on server management and troubleshooting in a typical month, and only 28 percent on strategic, 'value-added' activities. Despite the widespread availability of cloud and managed hosting, many organisations are clinging to physical servers, leaving in-house IT teams struggling with troubleshooting and capacity planning amid demands from their bosses to do more for less.

The Cloud Reality Check survey provides insight into how IT decision-makers at 500 mid-sized UK and US businesses approach server management and its related challenges. The new survey results are compared to the results of a near-identical study Rackspace commissioned in 2009, No More Servers, which contained responses from the same number of businesses similarly situated.

Capacity planning, the hard way

The report shows that most UK and US businesses seem to have either made poor progress or taken a step backwards regarding server management. The majority (59 percent) of UK respondents admit they have either bought too many servers, which has wasted money, or bought too few, which has meant a lack of capacity. In 2009, 55 percent of respondents said they got this wrong. In the US, the situation is worse: over two-thirds (67 percent) said they've purchased the wrong number of servers, compared with 47 percent in 2009.

IT teams at the service of servers

The respondents indicated that UK IT teams spend half (50 percent) of their time on server maintenance and troubleshooting today, slightly down from 57 percent result in the 2009 survey. Yet, using these results, a UK IT team member on average would still spend an estimated 912 hours a year* just servicing servers, rather than helping to drive innovation. US businesses reported that their teams spend even more of their time – 62 percent in a typical month – on server maintenance, and only a quarter of their time (25 percent) on ‘value-added' work.

Server complaints skyrocket

Tellingly, the 'hassle of managing servers' seems to be a problem for far more UK and US businesses now (79 percent) than was indicated in the 2009 survey (58 percent). Similarly, top gripes regarding managing servers physically on-site – hardware maintenance (53 percent), having to be available 24x7 (50 percent), and the cost of buying and maintaining servers (40 percent) – are voiced by more respondents in both the US and UK now than as reported in the 2009 survey.

Fabio Torlini, VP of Cloud at Rackspace, says: "Problems associated with having to manage and maintain servers are often readily solved by cloud and managed hosting services. In 2009, one-third (33 percent) of businesses surveyed expected to outsource their in-house servers in the next two to five years. However, over two years later, the new study suggests that many mid-sized businesses are still chained to their servers, and may be spending unnecessary time and money on them."

Bosses want more of IT for less

A large percentage of UK and US IT decision-makers interviewed said they are under mounting pressure to support business growth and change (89 percent, up from 65 percent in 2009), improve flexibility (88 percent, compared with 66 percent) and help drive internal innovation (88 percent, up from 61 percent). In addition, businesses are also facing demands from the board to reduce IT spending, according to 87 percent of respondents (up from 65 percent in 2009).

Jason Cremins, CEO of UK-based digital signage provider, signagelive, which has recently moved its media delivery infrastructure to the Rackspace Cloud, found the move helped his company tackle similar challenges. "We've seen dramatic reductions in operational costs and major improvements in the speed and reliability of our infrastructure after moving to the Rackspace Cloud. The move has also helped our customers. The content delivery business is moving away from in-house physical servers because the near-infinite scalability and reliability of cloud hosting lowers the barrier of entry for our customers and enables them to focus on their core business."

Addressing the issues holding IT back

This year's results show that 38 percent of respondents now expect to outsource their in-house servers in two to five years (35 percent in the UK; 40 percent in the US). Yet, top barriers to moving to cloud hosting – questions regarding security (54 percent), reliability (47 percent), and ROI (42 percent) – are holding back more organisations now than indicated in our 2009 survey. For example, security is seen as a barrier to server outsourcing by twice as many respondents in 2012 (54 percent), compared with 2009 (27 percent).

Another factor potentially holding back UK organisations in particular is their approach to new technology. Interestingly, although 28 per cent of UK respondents would describe their company's approach to new technologies, such as on-demand computing, as cautious and reactive, only 8 percent of their US counterparts would. Conversely, 39 percent of US respondents would describe their company as a cutting edge, corporate innovator, while only 10 percent of UK respondents would.

According to Torlini, the way the cloud and managed hosting market is maturing, as suggested by the study, represents a challenge to end-users and cloud and managed hosting service providers alike. "In 2009, almost two out of five (18 percent) of respondents didn't know what cloud computing was. In 2012, everybody does, and is looking at it – the benefits and the issues. The challenge for mid-sized businesses is to stop unnecessarily holding onto their in-house physical servers, and give themselves a chance to focus on more important and valuable work. The challenge for cloud service providers is to provide the right advice and services to help more of them overcome the barriers to doing just this."

About Rackspace Hosting

Rackspace Hosting (NYSE: RAX) is the service leader in cloud computing, and a founder of OpenStack, the open source cloud operating system. Rackspace provides Fanatical Support to its customers, across a portfolio of IT services, including Managed Hosting and Cloud Computing. In 2011, Rackspace was recognised by the Sunday Times Best Places to Work and Financial Times Top 50 Great Place to Work in the United Kingdom for the seventh year in a row. The company was also positioned in the Leaders Quadrant by Gartner Inc. in the 2010 Magic Quadrant for Cloud Infrastructure as a Service and Web Hosting. For more information, visit


Source: Rackspace Hosting

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