Rackspace has hired Cognizant veteran Dharmendra (D K) Sinha as president of the company's Public Cloud Business Unit. The move essentially confirm's that Rackspace has moved ahead with a plan to reorganize the MSP across public and private cloud markets.
The next obvious question: Will Rackspace sell off the private cloud business unit in order to focus purely on faster-growth public cloud opportunities? Perhaps we'll get answers when the multi-cloud MSP announces financial results on August 9, 2022.
Rackspace Hires Cognizant Veteran
Meanwhile, Rackspace has tapped Sinha to run the newly formed Public Cloud business -- which has longstanding MSP relationships with Amazon Web Services, Microsoft Azure and Google Cloud Platform.
In a prepared statement about the hire, Rackspace CEO Kevin Jones said:
“I’m thrilled to have D K on board at Rackspace Technology, as we accelerate our Public Cloud strategy. With his proven track record and vast industry expertise, he is the perfect leader to help us capitalize on this amazing market opportunity. He will immediately make an impact on the business and our growth strategy.”
“Rackspace Technology is in a unique position to be the leading, pure-play mulitcloud cloud solutions company. With this two-business unit structure across public and private cloud, as well as an added focus around apps, data, and security, we intend to become the premier strategic partners for our customers and partners across all market segments. I am also excited about further strengthening the company’s cloud solution ecosystem.”
Rackspace Cloud and Managed Services Business Evolution
Rackspace has pivoted multiple times over its business history. Originally a hosting provider, Rackspace initially attempted to compete against Amazon Web Services (AWS), Microsoft Azure and Google Cloud Platform (GCP). But the CSP (cloud service provider) effort, linked to OpenStack software, paid few dividends and Rackspace ultimately shifted to a multi-cloud MSP strategy.
Apollo Global Management acquired Rackspace Hosting for $4.3 billion in 2016 and took the business private. Another Rackspace IPO arrived in 2020, but investors were underwhelmed. Fast forward to July 20, 2022, and Rackspace’s current market capitalization is about $1.42 billion.
Still, Rackspace is focused on a growth market: Spending in the cloud managed services market is expected to reach $139.4 billion by 2026, up from $86.1 billion in 2021. That’s a 10.1% compound annual growth rate (CAGR) during the forecast period, according to MarketsAndMarkets.