Rackspace announces it has laid off 200 workers
Rackspace had it good with the little incentives they gave to web agencies. The agencies would build websites for companies that didn&#x27;t really need $$$ servers as they were new to being online and didn&#x27;t have the customers yet. Rather than recommend sensible hosting that could scale, e.g. a VPS that had the RAM, CPU, disk and bandwidth low to start with and an option to upgrade later, the agency would sell the newbie client the gold plated Rackspace solution. What wasn&#x27;t discussed with the client was how Rackspace would cough up a handy referral fee whereas the price competitive VPS would not.<p>I felt bad for clients that had been suckered with that cost burden, particularly if the customers did not show up after go-live. It was like the online equivalent of them being lumbered with a giant mall when they needed a prominent spot on the High Street.<p>Nowadays though services like AWS have taken on this agency provided hosting setup.