Ninefold and Rackspace Battle for Australian Startup Mind Space

Ninefold and Rackspace Battle for Australian Startup Mind Space

Last month American cloud computing service provider Rackspace, in an effort to expand its presence in the Australian market, announced a deal with early stage venture capitalists Pollenizer to offer Australian start-ups free hosting worth $2,000 a month for their first year of operations. Now, Rackspace’s Australian rival Ninefold has announced an identical scheme, also in partnership with Pollenizer and another incubator Starmate.

While Rackspace’s offer had been introduced in the US much earlier as the Rackspace Startup Program (See: Why is Rackspace targeting Startups? ), it’s something new in Australia. Considering that provider lock-in is a real possibility in these early days of cloud computing, Ninefold wouldn’t like a foreign rival stealing a march in its own home base; ergo, the counter-offer called the Ninefold Cloud Booster Program.

Ninefold is not shying away from promoting their initiative with patriotic overtones. “Ninefold is an Australian business helping Australian business,” said Peter James, Managing Director at Ninefold. “We’re really excited to launch The Cloud Booster Program as further evidence of our ongoing commitment to the local startup ecosystem.”

This is not the first time that Ninefold had tried to combat an established American rival in the cloud computing space. A few months back it had released a statement warning Australian customers of Amazon’s cloud services that their data may be subject to search and seizure under US legislation, unlike, of course, any data stored on Ninefold’s servers (See: Your Data in Australia is subject to the US Patriot Act).

While providers like Rackspace, Amazon and Ninefold have their own motives in encouraging startups, there’s no denying that their target clientele can benefit from such largesse. As Phil Morle at Pollenizer said, “During the first twelve months of a business, it can seem like finance only goes one way – out. By providing free cloud computing and storage to our Australian companies for one year, The Ninefold Cloud Booster Program allows fledgling web businesses to develop their ideas with the help of our mentors and without worrying about things like hosting or infrastructure.”

Niki Scevak of Starmate expressed similar views – “Startups have many challenges in front of them when they first start out and Startmate’s mission is to remove as many of those as possible to give them the best chance of success. By partnering with The Ninefold Cloud Booster Program, startups can launch and then scale more easily and quickly, removing crucial bottlenecks in the early stages

Also, as I had written earlier, while cloud computing can benefit all kinds of businesses (See: Virtualization: The Virtual Way to Real-World Benefits), it is startups that can benefit more than the others (See: Which Type of Businesses Benefit Most from Cloud Computing?) . Thus, this recent development is definitely good news for Australian entrepreneurs and may help encourage innovation in the region.

Several companies in the US have successfully used cloud computing to grow their operations rapidly (See: How Cloud Computing Helped Netflix Emerge as a Streaming Media Powerhouse and Zynga, the Latest Cloud Computing Success ); now, it’s time for that story to be replicated Down Under.

By Sourya Biswas

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