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APAC to the fore in colocation revenues; Equinix dominates globally

30 Mar 2016

Asia Pacific is home to five of the top 15 cities generating the bulk of the worldwide retail and wholesale colocation revenues, according to a new report, with four APAC sites seeing growth of 20% or more in 2015.

Synergy Research Group says the top five metro areas – New York, London, Washington, Tokyo and Silicon Valley – accounted for 27% of worldwide retail and wholesale colocation revenues in Q4.

Singapore and Shanghai, along with Chicago, Dallas and Frankfurt, account for 15%, with Hong Kong, Beijing, Amsterdam, Los Angeles and Paris accounting for 11%.

Strategy Research says in 2015, colocation revenue growth in the top 15 metros outstripped growth in the rest of the world by three percentage points, indicating the worldwide market is slowly being concentrated more into the 15 areas.

Shanghai, Beijing, Hong Kong and Singapore were among the six top 15 metros to see growth of 20% or greater, measured in local currencies, in 2015. Outside of Asia Pacific only Amsterdam and Frankfurt saw similar growth.

Tokyo had the highest growth rate of the top five metros.

John Dinsdale, Synergy Research Group chief analyst and research director, says the market research firm’s research shows the colocation market is highly concentrated around a relatively small number of metro areas and is slowly gravitating even more towards those areas.

“While major cloud providers tend to locate their hyperscale data centers well away from big urban areas, clearly the majority of colocation clients have a strong desire to locate their computing facilities close to major centers of commerce,” Dinsdale says.

“This trend is advantageous to large colocation operators with a data center footprint that spans those key metro areas.”

And when it comes to key market players, Synergy Research Group says Equinix was the market leader by revenue in eight of the top 15 metros, with Digital Realty leading in two more.

Other colocation operators featuring heavily in the top 15 include NTT, DuPont Fabros, Interxion, China Telecom, 21Vianet, KDDI, @Tokyo, SingTel, Global Switch, CoreSite, CyrusOne and TelecityGroup – which has now been acquired by Equinix.

Synergy says retail colocation accounted for 76% of Q4 revenues across the 15 metros, with wholesale making up the remaining 24%.

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