Rackspace® Hosting (NYSE:RAX), the world’s leader in hosting and cloud computing, today announced a set of new product offerings that help businesses move their IT applications into the cloud. The new offerings from Rackspace include Rackspace Cloud Drive, Rackspace Server Backup, and the upcoming release of Hosted Microsoft SharePoint (expected to be released in December 2009). These new products help customers to spend less time maintaining basic IT systems, such as file servers and data backup software, and instead focus on their core competencies that drive revenue and add business value. By putting these apps in the cloud, Rackspace is able to provide businesses with its award winning Fanatical Support® and a compelling value proposition.

“Most every business needs to send emails, share files, and backup data. But these systems are costly and complex to manage in-house,” said Pat Matthews, general manager, Rackspace Email & Apps. “The cloud presents a great opportunity for businesses to save money and work smarter. We believe that we are helping our customers gain competitive advantage by putting these apps in the cloud.”

Building on the momentum of its cloud-based email offerings, which include over 1.5 million paid-subscribers, Rackspace is now expanding into collaboration and backup applications that will help customers put more of their foundational IT software in the cloud. The new products mark a critical step toward more aggressively competing in the software-as-a-service market, enabling customers to achieve a server-less IT environment.

“This announcement is an important one for our business, as it highlights both the success of our existing email solutions and our expansion into additional business applications that can bring substantial cost savings to our customers and reduce complexity in their IT environments,” said Lew Moorman, president of cloud division, Rackspace Hosting. “More and more businesses are moving their critical applications to the cloud, and we can help them to achieve that goal.”

PRODUCT DETAILS:

Rackspace Cloud Drive is a cloud-based, online file storage application that allows individuals and teams to store, share, and backup files. With Rackspace Cloud Drive, customers can:

• Store and share files between employees.
• Access and manage data from inside and outside the office, without any additional hardware.
• Synchronize desktop folders with a cloud-based network drive across one or more computers.
• Backup data to the Rackspace Cloud and restore data in the event of a hardware failure.
• Protect data with AES-256 encryption using a key controlled by the customer.

Rackspace Server Backup is a cloud-based, online server backup application designed to protect your file server data. With Rackspace Server Backup, customers can:

• Backup server data to Rackspace Cloud Files for peace of mind.
• Manage data remotely using any Mac, Windows, or Linux PC.
• Protect server data with AES-256 encryption using a key controlled by the customer.

Rackspace Cloud Drive and Rackspace Server Backup are powered by technology from Jungle Disk, LLC, a Rackspace subsidiary acquired in 2008. For more information, product availability, and product pricing, visit http://www.rackspace.com/apps.

About Rackspace Hosting

Rackspace Hosting is the world’s leader in hosting and cloud computing and is ranked #43 on FORTUNE Magazine’s 100 Best Companies to work for in the United States. The company provides its customers Fanatical Support® in their portfolio of hosted IT services, including Managed Hosting, Cloud Computing and Email and Apps. For more information, visit www.rackspace.com.

Forward-Looking Statements

This press release contains forward-looking statements that involve risks, uncertainties and assumptions. If such risks or uncertainties materialize or such assumptions prove incorrect, the results of Rackspace Hosting could differ materially from those expressed or implied by such forward-looking statements and assumptions. All statements other than statements of historical fact are statements that could be deemed forward-looking statements, including any statements concerning expected releases, development, performance or market acceptance associated with our products and services, including our email products and services; anticipated operational and financial benefits from our products and services, including our email products and services; any statements of expectation or belief; and any statements of assumptions underlying any of the foregoing. Risks, uncertainties and assumptions include the possibility that expected benefits from our products and services, including our Archiving services, may not materialize because this product is not generally accepted in the marketplace, which could occur due to certain factors including (i) a failure to market our products cost effectively, differentiate the product from competitive products or communicate differentiations effectively, (ii) the reliability, quality or compatibility associated with our products, (iii) changes in technology which adversely affect our product’s benefit, (iv) slowdowns in the general economy or technology industry that impact consumer spending habits, (v) internal strategy decisions that impact the product, and (vi) and other risks that are described in Rackspace Hosting’s Form 10-Q for the quarter ended September 30, 2009, filed with the SEC on November 12, 2009. Except as required by law, Rackspace Hosting assumes no obligation to update these forward-looking statements publicly, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.