Complaint Review: Rackspace - Internet

First off I just want to say that the Rackspace hosting support staff are incredible, they really can help you with anything 24/7. As for their UK sales team, well that is another story. Please read on.


In mid December 2011, I started looking for a hosting company that has strong technical support for my first ever website which was nearing completion at the time. The website was a huge project, a social networking site that took me a year and a half of learning and coding to write from scratch. After I done some reading on the big names in hosting companies, Rackspace stuck out, and so I visited their website without delay. What could go wrong.

At the Rackspace website I was very impressed with their services, which boats their technical abilities and some of the big companies they work with. Soon after a popup window appeared, operated by a live support technician requesting any queries I may have, as well as my email address and a phone number I could be contacted on imminently. Very soon after I recieved a phone call from a UK sales representative from Rackspace.co.uk named Kristian Collett.

I explained in great detail over the phone that I was working completely alone on the websites coding and admin, that it would take a further 2 months to complete the coding, and that professional support would most likely be the best option for such a large project. I was very worried things could go wrong. Kristian Collett seemed very hesitant when I mentioned I had very little in the way of outside funding, as I'm sure he is by far used to dealing with small to large companies. He was very quick to mention how I could make a great saving by signing up for Rackspace hosting within the next couple of days, as their fiscal year end was rapidly closing. This gave me allot to think about.

After the initial phone call from Kristian Collett, he began emailing me contract after contract, none of which fitted any of my asking criteria, which was the basic standard linux server at 598.00 per month, that is priced on their website, and is managed by their qualified staff. But instead I was offered an 840.00 per month package with a 12 month contract and lower specs than were offered on rackspaces home page. This was quite baffling as it was made clear I via phone and email, that the fiscal year end meant greater savings. If anything I would be charged even more, much more than usual.

Soon another 12 month contract was soon slung my way. This time it would only cost me 629.74 per month. Reading the fine print again I noticed this package had an even lower spec RAM than the standard 598.00 per month package advertised on their site. By this point I probably should have turned around and walked away. Kristian Collett explained to me that these extra fee's were uncured because I would be benefiting from saving 472 on the server setup fee. My response was, that I would happily pay the setup fee, since it clearly meant I would be benefiting from a non fixed contract, even cheaper monthly bills and the standard (higher) RAM stated on the standard 598.00 per month package.

I stated very clearly via phone and email that a 12month contract was not suitable for me, as I was partly dependent on another party to help fund these costs. I made it clear to Kristian Collett that I would need to be able to pay for Rackspace services on a monthly basis so I can opt out at any given time, and that 598.00 per month was the maximum I could afford in any case. The agreement was then re-written for about the fifth time.

I couldn't believe my eyes, because now I was being offered even more RAM than I needed, no fixed contract and the setup fee was completely dropped. What could have possibly changed since their last offer agreement? Who knew, but in hindsight I believe they were desperate to close any open deals before the fiscal year end, that they were happy to mislead whomever and have their legal team clean up the mess in the new year.

By this point I happily signed and returned the contract to them, along with the agreed initial 598.00 payment, which would sit in their hands until my website was finished and ready to go live within the next couple of months. The next day I emailed Kristian Collett and requested a receipt for the first payment, no response. The following 2 months would come to pass while I finished the coding. Numerous times I was asked, "Is the site ready?", but no reply as for producing a simple receipt of payment. Which meant I could not claim any of my down payment back.

Email after email was ignored, until finally I said, "I really appreciate the price you were able to offer me your services at Rackspace, but I feel I am going to have to cancel my server with Rackspace. By law you must supply me with a receipt of payment. You have repeatedly ignored this request since December 29th 2011 and I have been very patient with you. If this is how your company operates then I am afraid I do not want to risk going any further with this project which is very important to me. Marx."

Over 2 months of waiting and numerous emails, I finally received a reply from Kristian Collett within 5mins, how convenient. It would later become very clear why this request for a receipt was ignored for so long. My website was just about ready and I could not ask for a refund at this point, so I decided to make use of my down payment and try Rackspace out for a month. I then gave the go ahead to Kristian Collett that I was now ready.

Approx 10 days later my server was ready, and I received an email from a lady named Jessica, who deals with customer support and accounting. The email contained a link to the server admin log in page, but no log in credentials whatsoever. It was a 'No-Reply' email, so I waited for further contact from Jessica, and nothing. So I emailed Kristian Collett no less than 4 times over the next week, stating my problem. He did not respond to a single one. I searched everywhere online for rackspace.co.uk support emails, and still no responses from the UK staff.

I was being charged everyday that went by, while I had no access to this very expensive web server. My last option was to try the Rackspace live support technician on their website. So I explained my situation to them. In turn the support staff were able to get through to Jessica in order to contact me. Later I spoke with Jessica on the phone. I received an apology for her failure to forward on my account log in details from the beginning.

No compensation was offered at this time. As for Kristian Collett, no reason was ever offered as to his failure to help. Soon my website was ready to go. The support staff were fantastic, capable of helping me through any issue I ran into. As the next couple of weeks went on I received bills from Rackspace stating additional pro-rata fee's of 40, 50 added with no explanation as to where the fee's were incurred, bearing in mind I had only just gained access to my web server. Soon things were to get even more interesting.

By now I am approx 3 weeks into my Rackspace service agreement. Soon I am due pay my next month's advance 598.00 monthly payment plus the additional pro-rata expenses they have added, and I am already down 1 week's usage. Then I receive the following email:

"Good Morning Marx We are currently going through VAT audit, I have gone through our system and I cant see that we hold a VAT exemption number for your account. Please can you let me know if you have a Valid VAT number for your account, if not we will need to credit and reissue your Invoices with VAT Regards Dean Johnson."

The monthly outgoing bill now sits at over 800.00 including VAT and pro-rata, all of a sudden it was clear to me why Kristian Collett hesitated to supply a receipt, and when he did, it only stated the full amount payed, leaving me to believe any VAT was either inclusive or nullified. Checking back over the agreement I sent to him with my signature, it states VAT will not be levied for EU clients outside of the scope of UK VAT.

Also I noted that the signed service agreement I emailed to him was a 7 page agreement. This was not the same agreement he sent back to me the following day, when the agreement was confirmed. It had been edited without my consent. It was now 8 pages long and certain fields were now blank, including those regarding my home address, VAT check boxes, even my signature had been replaced with what looked like my IP address, and some small details of my web severs hardware had been either removed or changed.

From there on it was clear I would definitely need to cancel my account, and make use of the monthly service agreement we had, before the following month could roll on. So I emailed Jessica right away stating I would not be able to fund the server any longer. Then I moved my entire site to another host immediately. It was then that Jessica emailed me to say I still have to pay an additional 30 days. This would bring the total cost of 23days worth of Rackspace server usage to approx 1500.00 wow!

This was not what I had originally agreed to. Rackspace did at least offer to discount the original week they charged me for they're own blunder, but I was still not happy by the way I felt I had been mislead. Jessica referred me to the terms of services on their website. I pointed out to Jessica that I could not find any reference regarding the difference between the stated monthly agreement and the 12month contract I was originally offered, and that I would like them send me an outlined copy. All I received was bill after bill, by which point I didn't even bother replying to any further emails from Rackspace.

A few months later, I receive the attached email from a Rackspace representative named Raji Aulak. Stating that Rackspace intend to take me to court and sue me, if the left over balance of 767.74 is not payed within 14days. My question to anybody reading this, lets say that given every word I said in this report is the honest truth, and that I am prepared to back up all that I say via email records if it comes to court. Is Rackspace really in a position to sue me for so little, when they have given me good reason to sever ties with them? Now allot of you will say, "they are Rackspace! they don't need to use deceptive tactics to extort money.", but for 767.74 and given these circumstances, it looks like they do need every penny they can get.
What would you do?