Story image

APAC providing 40.1% of space for colocation; consolidation ahead

04 Apr 16

The global colocation market is expected to top US$33.2 billion by 2018, with Asia Pacific now accounting for 40.1% of total operational space for colocation.

451 Research says the data center colocation market saw US$27.0 billion in annualised revenue in Q4 of last year, with the majority of the revenue derived from local providers with sub-$500 million in annualised colocation revenues.

The technology research and advisory firm estimates Asia Pacific is the world’s largest region in terms of total operational space for colocation – space supporting IT equipment.

It says APAC growth has been fuelled by the sheer size of the economy and a less entrenched installed base of enterprise facilities to compete with colocation providers.

“In addition, some Asian countries have been supporting their colocation industries with special zones and tax treatment,” 451 Research says.

APAC’s 40.1% share of the total operational space compares with North America’s 33.7% and Europe, Middle East and Africa’s 22.1%. Latin America accounts for just 4.1% of space.

The company is forecasting global data center square footage to grow from the current 132.4 million square feet to 176.5 million square feet by the end of 2018.

Digital Realty, primarily a wholesale provider, holds the largest percentage of the overall global colocation square footage, at 7.8%, followed by Equinix at 3.8%.

NTT Communications is third behind Digital Realty and Equinix, with 1.9% of the global square footage, followed by Verizon (1.6%) and Level 3 Communications (1.5%).

Global Switch and DR Pen (1.3%), China Telecom (1.2%), LinkTom and CenturyLink (both 1.2%) round out the top 10 on the square footage side.

The top two positions are reversed when it comes to combined annualised wholesale and retail colocation revenues with Equinix leading the way with 8.1% share, versus Digital Realty’s 5.6% share.

CenturyLink, which ranks tenth in terms of square footage, claims 2.4% of annual revenues, with Telecity and Verizon rounding out the top five for revenue at 2.0% share and 1.9% share respectively.

Global Switch and Dupoint (both on 1.7%), Interxion and CyrusOne (both 1.6%) and AT&T rounding out the top 10.

Katie Broderick, 451 research director, says the colocation market is serving as data center arms dealer to both enterprises and the cloud.

“In this process, colocation is often becoming the strategic connection point between the two,” Broderick says.

451 Research is predicting consolidation ahead for the industry, as data center providers seek to gain scale, add services, or both.

“This is not because the industry is in trouble; the move to cloud continues to drive strong demand for leased data center space,” says Kelly Morgan, 451 Research North American Data Centers research director.

“It is because the industry is maturing and providers are becoming more strategic in their approach to customers.”

Lenovo DCG moves Knight into A/NZ general manager role
Knight will now relocate to Sydney where he will be tasked with managing and growing the company’s data centre business across A/NZ.
The key to financial institutions’ path to digital dominance
By 2020, about 1.7 megabytes a second of new information will be created for every human being on the planet.
Is Supermicro innocent? 3rd party test finds no malicious hardware
One of the larger scandals within IT circles took place this year with Bloomberg firing shots at Supermicro - now Supermicro is firing back.
Record revenues from servers selling like hot cakes
The relentless demand for data has resulted in another robust quarter for the global server market with impressive growth.
Opinion: Critical data centre operations is just like F1
Schneider's David Gentry believes critical data centre operations share many parallels to a formula 1 race car team.
MulteFire announces industrial IoT network specification
The specification aims to deliver robust wireless network capabilities for Industrial IoT and enterprises.
Google Cloud, Palo Alto Networks extend partnership
Google Cloud and Palo Alto Networks have extended their partnership to include more security features and customer support for all major public clouds.
DigiCert conquers Google's distrust of Symantec certs
“This could have been an extremely disruptive event to online commerce," comments DigiCert CEO John Merrill.