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Positioning its cloud hosting services as an alternative to Amazon’s (NASDAQ:AMZN) Elastic Compute Cloud (EC2), Rackspace (NYSE:RAX) announced Tuesday the public availability of Cloud Servers API based on representational state transfer.

Taking an open-source approach, Rackspace’s 43,000 cloud-computing customers played a major role in the API specifications, explained Emil Sayegh, general manager for The Rackspace Cloud, formerly branded as Mosso cloud hosting. They overwhelmingly preferred the newer lighter-weight REST approach to the older heavy-duty SOAP standard that Amazon uses, he said.

“With the number of companies that provided input into this API, the way I see it this is their design,” he told BriefingsDirect. “This API is based on their input.”

This open community approach is a major differentiator between Amazon and the Rackspace alternative.

It may very well also be a difference with Microsoft (NASDAQ:MSFT) and its Windows Azure offerings, the initial pricing of which was also unveiled Tuesday. See Mary-Jo Foley's take.

The next step in Rackspace’s strategy is to open-source the API, which according to Sayegh will be announced soon. He notes that Amazon has no announced plans to go to open source.

“What we’re seeing is customers are really clamoring for an alternative to Amazon,” Sayegh said, acknowledging that Amazon is the market leader while positioning Rackspace as the number two that is trying harder.

“We have the largest platform as a service (PaaS) in cloud sites,” Sayegh said. “We are definitely in terms of size second to Amazon.” He sees Tuesday’s release of the API strengthening the Rackspace Cloud position in the market.

I recently talked with Mosso co-founder Jonathan Bryce, and a group of analysts, on the subject of PaaS and its role in propelling cloud computing forward. Read a transcript.

Prior to the API release, customers used a Web-based control panel to manage their Rackspace cloud usage. This meant they had to manually scale up or down as their business demands fluctuated.

The API allows developers to programmatically interact with the Rackspace cloud servers so scalability can be made automatic, Sayegh explained. The control panel option is still available but the API offers greater choice and flexibility.

“People are raving about how easy it is to use,” he said. As an example, he pointed to Michael Mayo, a developer working alone who was able to create an iPhone remote cloud server management app based on the new API in just three days. Sayegh said even he was surprised that a lone coder could use the API to build an application that quickly.

Rackspace Cloud currently offers three cloud hosting products:

  • Cloud Sites, which provides pools of servers for customer Websites.

  • Cloud Servers, which provides server capacity that can be scaled up and down as the customer requirements change.

  • Cloud Files, which provides “unlimited storage” for images, large files, and backups.