Rackspace Shutters Slicehost for OpenStack Future

Rackspace (s rax) has informed Slicehost customers that it will be shutting down the popular cloud-hosting service. Rackspace bought Slicehost in 2008 to serve as the foundation of its Rackspace Cloud business, but since Rackspace is now betting its cloud computing future on the OpenStack platform built along with an open source community, there is little reason to keep Slicehost around. Slicehost customer accounts will be transitioned over to Rackspace Servers accounts over the next year.

In his letter to Slicehost customers, Rackspace Vice President of Products Mark Interrante cited two underlying reasons for the decision: the industry-wide shift from IPv4 to IPv6 and the acceptance of “openness and collaboration in the creation and consumption of IT.” OpenStack addresses both of these concerns and, along with the continued advancement of Rackspace’s internal cloud computing efforts, makes the Slicehost offering largely obsolete, especially as Rackspace continues to merge its cloud and managed hosting businesses.

Further, as Interrante points out, “With two brands, two control panels and two sets of Support, Engineering and Operations teams it has been a challenge to keep development parity between the products.” Read: we’re just not willing to commit resources to this product that will detract customers from Rackspace Cloud and the greater OpenStack community of providers.

Rackspace is betting that a robust OpenStack ecosystem of providers will provide a formidable alternative to Amazon Web Services (s amzn) and other proprietary cloud platforms, so dumping human and capital resources into a product that doesn’t align with the OpenStack vision is just bad business. There’s little to be gained by stifling ecosystem growth even minimally by keeping the Slicehost option available.

I’m sure some Slicehost users will be upset by the news, but the writing has been on the wall since Rackspace announced OpenStack in July. And it’s not like a Rackspace Cloud built on OpenStack is such a bad thing. Rackspace Cloud is priced comparably to Slicehost, but offers the added capabilities of Cloud Files and Managed Service Levels among other things. Plus, OpenStack will only get better with time, as Cisco’s Network as a Service proposal and others laid out during the recent OpenStack Design Summit illustrate.

Image courtesy of michael ely.