Anyone thinking about storing data in the cloud has another option to think about. Rackspace, the giant IT systems hosting company, and Mosso, its cloud division, last week rolled out a new cloud storage service that one observer says “leapfrogs” Amazon’s S3 (Simple Storage Service). CloudFS is a hosted scalable system that Mosso says developers can use to securely store nearly unlimited amounts of data on the Web, and pay for it on an as-used basis.

“Basically, we’re offering a scalable storage system that can be tailored to the user’s needs,” says Mosso co-founder Jonathan Bryce. “It will appeal to a broad range of businesses, but it’s primarily focused at people who want to integrate massively scalable storage into their applications.”

Developers access Mosso’s storage platform through a RESTful Web services API and language-specific APIs (Java, .NET, Ruby on Rails, Python, PHP). “We think developers prefer a storage system that’s API-accessible and lets them use industry standard tools,” Bryce says. “They can customize and integrate the system to meet their needs. For example, they can have data come in from a desktop through this API and the system makes sure it’s written and copied and kept redundant.”

Customers who use Mosso’s hosting service will have a performance advantage because they won’t experience the latency that’s typical of tapping stored files over the Internet, says John Engates, chief technology officer of Rackspace. “If you want to use S3, you have to go over the public Internet. It’s all remote. But if you come in over our infrastructure, you’re closer to your application from a network perspective. If you build your app on the Mosso platform, you can have your application infrastructure close to your cloud and storage.” Faster access to stored data will be a “critical business advantage,” Engates says.

Under the current private beta-test program, users will access data through Rackspace’s storage and server infrastructure. In the future, customers will have the option of accessing the service over the Web. (For now, storage is hosted in the company’s Dallas datacenter, but Rackspace has seven others it could add to the mix.)

Mosso says the current beta program will last until the third quarter of this year, followed by a public beta test, with the official opening expected by the end of the year. The company hopes to enlist about 100 serious users for the private phase, Engates says. Interested users can apply for the beta program at www.mosso.com/cloudfs.

Storing data in CloudFS costs 15 cents per gigabyte per month (at least during this initial phase). Customers who access their data over the Web rather than Rackspace’s network will be charged extra for data transfer and, as with Amazon S3, file sizes are limited to 5GB (the similar but less publicized Nirvanix allows files up to 256GB). The cost of data transfer on S3 is 10 cents per gigabyte in, and between 10 cents and 17 cents per gigabyte out.

Not Just Storage, but Compliant Storage

Mosso emphasizes that it’s offering companies more than just a place to put stuff. Service and support will be a key part of CloudFS, officials say. “People want options. They want more IT services,” Bryce says. “Rackspace has been hosting IT systems for 10 years and has developed the kind of support and comfort people will want as they move business into the cloud.”

That support goes beyond troubleshooting technical problems. One of the big challenges Mosso will help with is storing data in accordance with federal regulations. “Meeting regulatory criteria is something we know how to do,” Bryce says. “We know how to deal with Sarbox [Sarbanes-Oxley requirements for financial information] and HIPAA [Health Information Portability and Accessibility Act]. We know how to deal with auditors and federal security requirements. Some of our customers will be people who wanted to use S3 but couldn’t because of these concerns.”

“Customer service and support is crucial to these people,” Engates says, “and that’s one way we differentiate our offering.”

Mosso says CloudFS is geared particularly toward serving companies that rely on “mission-critical infrastructure.” The biggest beneficiaries will be businesses running Web 2.0 applications, social networking sites, and multimedia hubs, Bryce says. Another “sweet spot” for CloudFS will be backup and archiving of tons of data, he says. “It’s more reliable than tape and less expensive than traditional enterprise stuff.”

SaaS Platform Provider Likes Support

One developer currently testing CloudFS is Qrimp, which provides online tools for building database-driven applications. Businesses use Qrimp to design and deploy Web applications using just a browser and without needing programming expertise. “Think of it as platform as a service,” says company founder and CTO Randall Minter. Qrimp has been used to develop online stores, corporate intranets, media-sharing sites, “and everything in between,” Minter says.

Qrimp has been a Mosso Hosting Cloud customer, so moving to CloudFS for storage makes practical sense. “The main reasons we wanted to move to CloudFS are vendor consolidation and reduced bandwidth costs,” Minter says. “The network latency will also be reduced because the entire system will be running on Rackspace infrastructure. We don’t have a lot of disk requirements currently, but I would like the system to operate faster.”

Another issue, Minter says, is support costs. “Amazon just released their new support services charges, which are a minimum of $100 per month for Web-based response and $400 for phone support.  These costs are in addition to the data storage. Compare this to Mosso, which includes 24×7 phone support in its hosting service offering, so most customers pay a flat fee of $100 per month.”

SaaS developers and Web applications builders “are really embracing storage as a service,” says Daniel Golding, vice president and research director with Tier 1 Research. “Small businesses in particular don’t want to have to buy a lot of drives or make huge capital investments in hardware. They want someone reliable who can do it for them. There’s very little downside for SMBs or most enterprises to move to these storage platforms.”

Golding says the Rackspace/Mosso combo should avoid the performance issues that have been the reason for criticism of S3. Amazon is working to fix these problems, he adds, but “people have to realize that S3 was not architected for speed.”

Although there has been chatter online by some people saying they’ve had problems with Rackspace hosting, Golding says the company “is a very reliable firm with some high-profile clients.” Bumps encountered during the CloudFS test will be ironed out during its relatively long test period, he says.

Golding says CloudFS “leapfrogs S3” in terms of features and predicts it will pose a “significant challenge” to Amazon. “Rackspace’s first bite of the ‘storage cloud’ apple approximates the services of S3, but at a better price and with better support,” Golding says. “Keep in mind that S3 and Nirvanix and CloudFS are not end-stage products. This is still 1.0 for storage as a service. There’s significant evolution ahead.”