Q: What is the business model for partners?

A: The business model of a "cost efficient" cloud operator is described in an article of 2018. This article explains how it is possible for Rapid;Space to achieve in 2018 a price  of 195€ / month for a VPS service with 24 core, 256 GB of RAM and 4 TB SSD. Each cost is described in a single table:

In 2019, the cost could even be lowered by using a more efficient daracenter: Hydro66 in Sweden and Green Data in France. The total cost is about 155€ thanks to the use of cost efficient colocation, transit and electricity. In 2019, we also achieved a cost of about 190€ in China due to the much higher transit cold in mainland China. Taiwan case in 2020 was in-between EU and mainland China. Japan will be in 2021 even more expensive than in mainland China due to the extremely high cost of hosting and transit in Japan. Overall, the cost of hosting a Rapid.Space ranges from 155€ (EU) to 255€ (Japan).

A cloud is thus a service made by combining of :

• hardware (servers, switches);
• software (virtualisation, database);
• electricity;
• internet transit;
• colocation space;
• operation management;
• support and maintenance of the hardware;
• financial costs.

Operation management consists of all the tasks related to the maintenance of the SlapOS central orchestrator of Rapid.Space as well as the standard software profiles. This task is done by Rapid.Space International company. As part of this task, Rapid.Space International collects payments from customers and transfers those payments to points of presence (minus 20€ / month for its service of operation management).

How does a partner make profit?

Electricity, internet transit, colocation space and financial costs are paid by the point of presence (POP). Nobody makes profit out of this except the electricity company, the internet transit provider, the colocation datacenter and the bank.

In Rapid.Space, both hardware and software are open source and thus do not lead to any profit as such. Rapid.Space actually sells hardware to its partners at a price equal to costing price + the cost of lifetime operation management, which usually means it it the best offer on the market.

However, hardware needs to be:

• setup with Rapid.Space software;
• maintained accordinhg to Rapid.Space procedures (ex. listen to the noise of fans, replace RAM);
• raplaced (ex. if it breaks and is sent for RMA).

Hardware management tasks are assigned by a local point of presence (POP) to local companies, such as a system integrator (SI) or a datacenter(DC). It may involve in some cases a service called "Remote Hands" whenever the people of SI in charge of the maintenance are not on site of DC.

Usually, the POP who invests in the hardware also tries to find local customers. The minimal investment for a POP is around 50,000€.

How does a partner make more profit?

To make more profit, partners need to sell value-added services to the market. Those services include:

• first-level support and training;
• P2V and V2V migration;
• active monitoring;
• development of custom software profile;
• providing SaaS based on a custom software profile.

With first-level support, a local partner acts as an intermediary between end-user and Rapid.Space. This can be useful to complement the training and support service of Rapid.Space which is optimised for highly skilled engineers but is not suitable for beginner engineers.

As part of the first-level support, partners can provide P2V or V2V migration to move servers or virtual machines from existing infrastructure to Rapid.Space. This represents about 100€ per VM. With 100 VMs, this is about 10,000€. A local POP may sometimes be ready to finance this initial cost as part of a long-time subscription (35 months) so that the SI can achieve the 10,000€ revenue immediately whereas the POP secures the recurring revenue.

Active monitoring means that a local partner ensures that the service provided by Rapid.Space meets the customer requirements is able to explain to Rapid.Space how it does not. Having local partners able to provide this monitoring service helps Rapid.Space increase its quality of service. It would be very difficult for Rapid.Space to achieve this service alone because it does not have direct contact with the customer, which means it is difficult to understand all its requirements. Also, by not being present in the same country, it is sometimes difficult for Rapid.Space to understand the nature of a problem: sometimes, quality problems do not come from Rapid.Space but from the local Internet (as in mainland China) and can vary from day to day, from one city to another. A local partner is able to do that much better.

Rapid.Space is an extensible platform based a language that can be used to create new services with full operation management automation. For example, it is possible to use Rapid.Space as a farm of "moodle" e-learning application by creating a moodle profile. This profile needs to be developped and later maintained. This can lead to projets in the range of 10.000€ to 100.000€ of non-refundable costs and 2.000€ to 20.000€ of recurring costs.

Partners who develop software profiles by themselves or through third parties may also want to commercialise profiles by becoming a Software a a Service (SaaS) provider. This adds yet another source of recurring revenue which can scale.

Typical sales are summarised in the table below.