[cturner]

    Seems like it could just as easily turn against them if
    someone else turns their open source solution to better
    advantage (assuming the open source license permits this).

Sure, but that's their comfort space. They're confident of their skills and economies of scale here, and enthusiastic for this to be the battleground.

My point with the amazon example was partly that if Rackspace found itself needing to build something similar, it has a stronger starting point if it already has a software group. And because the platform is open, they might have a shared interest with another company who has taken on their software to collaborate on new features. Or another party may build an open payment system on top of this open system when they're not even looking, and they benefit from the network effects.