from Hacker News

Rackspace Buys Server Management Platform Cloudkick (YC W09)

by wouterinho on 12/16/10, 11:59 AM with 59 comments

• by dotBen on 12/16/10, 5:21 PM

  As an on/off CloudKick user (long story) my concern is that RackSpace has purchased the company to obtain performance and metric data for its competitor's serving solutions. If I'm right, expect to see them reduce the price and/or increase the allowances of the free tier in order to obtain more data.

  This is always a problem when a company is purchased by one of the vendors it sits above in the value chain, esp when impartiality and independence is important in a space such as vendor monitoring.

  I can't see RS buying CloudKick for internal monitoring of its own customer's servers and instances because they would already have a mature solution by now.

  I'm not sure I want to be providing RackSpace with performance data of my servers running on their competitor's instances, the CloudKick agent is placed to send (albeit transparently) all sorts of data back to RS. And don't be surprised if other vendors raise concerns to this effect too.

• by po on 12/16/10, 2:29 PM

  My main complaint with cloudkick has always been the wide price gap between the free account and the first paid version. I would have paid for their agent based service for a few of my projects but at $99 a month for the cheapest version, it would have cost over 5x what the server it was monitoring cost.

  I think they would have grown much faster with a smoother price curve. Make a plan with 2 or 3 servers of full monitoring for $30 a month to grab the low end of the market when people are just starting and putting in the foundational pieces of their technology stack.

  Overall though, they're really good. They seem to have done plenty well anyway. Congratulations.

• by tomhoward on 12/16/10, 12:36 PM

  Couldn't have happened to a better bunch of guys. Really great news, congrats gents.

• by mbreese on 12/16/10, 12:22 PM

  I wonder what this will mean for Cloudkick's support for other clouds...

• by pdx on 12/16/10, 4:54 PM

  This is nothing against cloudkick. I've never even been to their site. I'm sure their service is amazing. My question is a general question that I ask almost every time I see a company get bought.

  The question is, "Why buy, when you can build?"

  Let's say I'm Rackspace. I have a cloudkick account that I used when I was evaluating them to see if I wanted to buy them. I know exactly what they offer.

  So, let's say I take that and I create an engineering specification. Build a service that does this, this, this, and this, duplicating cloudkick, right down to the screen layout of the dashboards, if you're so inclined.

  Now, go hire 10 engineers. No, make it 20. Now hire 5 project managers. Pay each engineer $100K + benefits, say they cost me $150K per year. Pay each project manager $150K + benefits, say they cost me $200K per year. So now I have 20 engineers and 5 project managers whose combined salaries + benefits cost me $4 million a year. Let them work for two years. For $8MM, I have my own cloudkick, right?

  Why would I pay more than $8MM? Perhaps they didn't, I don't know. Again, my questions isn't about cloudkick. It's about why you see companies make the buy decision, when it often seems like it would be well within their ability to build it themselves, if they are so willing to spend money.

• by revorad on 12/16/10, 12:13 PM

  Merry Christmas, YC!

• by ericflo on 12/16/10, 6:55 PM

  Awesome news for both CloudKick and Rackspace. For what it's worth, I hadn't really tried out CloudKick before, but tried it after today's news...I'm quite impressed. I really hope Rackspace rolls this functionality into their own offerings.

• by OoTheNigerian on 12/16/10, 1:15 PM

  YC is on a roll. Congratulations to all involved.

  Now back to work as i wait patiently from my turn. :)

• by vidar on 12/16/10, 12:09 PM

  Price anyone?

• by joetyson on 12/16/10, 2:44 PM

  Congrats cloudkick! Rackspace is getting an awesome product and even more amazing team.

• by johnyzee on 12/16/10, 12:55 PM

  Score another for YCombinator.

• by ConceptDog on 12/16/10, 8:17 PM

  Good for them. Good toolset, good platform. Really needs an iPhone app.

• by foobarbazetc on 12/17/10, 2:24 AM

  Let's hope the insane CloudKick pricing is looked at by RackSpace.

• by geekinthecorner on 12/16/10, 5:21 PM

  Rackspace is desperately in need of as much help as they can get. Whereas the rest of the industry (Softlayer, etc) spent the last five years building out automated infrastructure, Rackspace spent it mostly on sales. As a customer with dozens of servers at Rackspace, and hundreds at Softlayer, the difference is night and day.

  I feel bad for Cloudkick as a company, though. San Antonio is a million miles away from San Francisco, culturally. Good job on having an exit, good luck on not hating yourselves in a year.