Data Center Companies

Many of the world's largest data center providers offer wholesale and/or retail colocation services in multiple countries.

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When an organization needs a data center, it doesn't necessarily build and operate that data center on its own. Instead, they turn to the many different vendors offer both wholesale and retail data center services.

In fact, the market for data center services seems to be expanding rapidly. The trend toward cloud computing has been a boon to data center providers as many of them count companies like Amazon Web Services, Microsoft Azure, Google Cloud and IBM among their customers. According to Structure Research, the colocation market was worth $33.59 billion in 2016, a number that is likely to grow 15.2 percent in 2017. And 451 Research predicts that the wholesale and retail colocation markets could be worth $48 billion by 2021.

With so much money at stake, data center providers have become prime targets for mergers and acquisitions. As a result, many of the largest companies in the market are currently involved in buyouts and takeovers. A few have exited the business while many others are trying to expand the roster of data center services they can provide.

Data Center Solutions

Identifying which types of data center services a vendor offers can be tricky because the industry doesn't have a standard terminology. Some organizations even lump their cloud computing services in with their data center services, which can make things confusing.

In general, however, data center providers other four different kinds of services: wholesale colocation, retail colocation, and hosting.

Wholesale colocation vendors offer very large facilities, usually an entire data center or at a minimum a very large room with tens of thousands of square feet, which will be used by a single organization. Typically, the leases on the facilities extend over a long period, often more than three years. In general, wholesale data centers offer excellent redundancy capabilities and they provide access to massive amounts of power. However, wholesale facilities often don't have as many options when it comes to connectivity and carriers. Customers may be extensively involved in the design and layout of the facility, as well as the management of the facility, and they own the servers in use.

In retail colocation, many different customers share the same data center. Individual customers may have their own racks or rooms, or they may be intermingled with those belonging to other organizations. The lease periods are much shorter—perhaps even just a year, but retail facilities often have a whole lot of connectivity and carrier options in order to cater to the needs of different companies. Customers don't have as much input into the design and operation of the data center, but as with wholesale colocation, they own the servers.

The biggest difference between hosting and retail colocation is that with hosting, the vendor owns the server. The customer may have some ability to manage the server through a Web interface, but the provider is ultimately in control of the computer equipment. Hosting customers give up a lot of control, but in return they get lower prices and shorter-term contracts.

In recent years, the lines between these three different types have blurred. Some vendors do not specify whether their colocation services are retail or wholesale, and some use the terms hosting and colocation interchangeably. Generally, however, these are how the terms are used within the industry.

Data Center Services

Top Ten Data Center Companies

According to recent reports, these are the biggest data center vendors, but the market is in quite a bit of flux. Market share information in this section comes from 451 Research. Revenue numbers come from individual companies' most recent annual reports.

1. Equinix

Market share: 9.5 percent

Headquarters: Redwood City, Calif.

Services offered:Wholesale and retail colocation

Annual Revenue: $3.6 billion

Data Centers: 150+

Markets Served: 21 countries worldwide

Equinix is the undisputed leader in the data center business, and it has announced plans to acquire Verizon's data center business, which will give it even more market share. Its customers include Amazon Web Services, Microsoft Azure, Salesforce.com, eBay, LinkedIn, Netflix, GE, Chevron, Bloomberg, NASDAQ, AT&T, T-Mobile and many other well-known companies.

2. Digital Realty Trust

Market share: 5.7 percent

Headquarters: San Francisco, Calif.

Services offered: Wholesale and retail colocation

Annual Revenue: $2.1 billion

Data Centers: 156

Markets Served:North America, Europe, Southeast Asia, Australia

Digital Realty operates data centers in more than thirty different markets on four different continents, but the bulk of its operations are in the United States. It boasts an "industry-leading record of ten years of 5 nines" availability and a future-proof strategy.

3. China Telecom

Market share: 3.3 percent

Headquarters: Beijing, China

Services offered: Wholesale and retail colocation, hosting

Annual Revenue: $352 billion

Data Centers: 400+

Markets Served: primarily China, with some overseas facilities

Although primarily a telecommunications provider, China Telecom is also China's largest data center provider, and it also has subsidiaries in the Americas and Europe. It is owned by the Chinese government.

4. CenturyLink/Cyxtera Technologies

Market share: 2.1 percent

Headquarters: Monroe, La.

Services offered: Colocation

Annual Revenue: $17.5 billion (CenturyLink)

Data Centers: 57

Markets Served: North America, Asia, Australia, UK, Germany

Known primarily as an Internet Service Provider, CenturyLink recently sold its data center business to a group of investors, who will operate the business under the name Cyxtera Technologies. However, CenturyLink also retained 10 percent ownership of Cyxtera. It plans to use the money from selling the data center business to partially fund its acquisition of Level 3 Communications, which will significantly increase its market share when the deal closes.

5. China Unicom

Market share: 2.1 percent

Headquarters: Beijing, China

Services offered: Colocation

Annual Revenue: $274 billion

Data Centers: Unknown

Markets Served: primarily China

Like China Telecom, China Unicom is primarily a telecommunications provider owned by the Chinese government. It offers colocation services primarily for global companies doing business in China.

6. Verizon

Market share: 1.9 percent

Headquarters: New York City

Services offered:Colocation, hosting

Annual Revenue: $125.98 billion

Data Centers: 29

Markets Served:15 metropolitan areas, primarily in North and South America

Verizon is getting out of the data center business, having sold out to Equinix. Instead, it will concentrate on its telecommunications businesses. The company is also exiting the cloud and hosting businesses, selling to IBM.

7. DuPont Fabros Technology (DFT)

Market share: 1.9 percent

Headquarters: Washington, D.C.

Services offered: Wholesale and retail colocation

Annual Revenue: $124 million

Data Centers:12

Markets Served: North America

Like many of the other data center providers on this list, DFT is in the midst of an acquisition. In June 2017, Digital Realty announced plans to acquire the smaller company for $7.6 billion in stock.

8. Level 3 Communications

Market share: 1.8 percent

Headquarters: Broomfield, Colo.

Services offered: Colocation

Annual Revenue: $8.2 billion

Data Centers: 350

Markets Served: North America, Europe, Latin America

Level 3 offers telecommunications and Internet services, as well as data center services. It is currently in the process of being acquired by CenturyLink.

9. CyrusOne

Market share: 1.7 percent

Headquarters: Dallas, Texas

Services offered: Wholesale and retail colocation

Annual Revenue:$529.1 million

Data Centers: 35

Markets Served:US, UK, Singapore

While many of the vendors on the list offer other services in addition to data centers, CyrusOne focuses primarily on colocation. It claims, "More than any other data center and colocation provider, CyrusOne has been selected by the Fortune 20 and Fortune 1000 to deliver excellent reliability and highly scalable data center solutions."

10. Interxion

Market share: 1.6 percent

Headquarters: Amsterdam

Services offered: Colocation

Annual Revenue: €421.8 million

Data Centers: 45

Markets Served: Europe

For more than 20 years, Interxion has been operating data centers throughout Europe. It currently has facilities in thirteen different major metropolitan areas and serves more than 1,600 customers.

Other Large Data Center Providers

According to 451 Research, providers outside the top ten account for 68.4 percent of the data center market. The data center vendors listed below are among the largest in this group, however, within this section they are listed in alphabetical order rather than by size.

11. @Tokyo/SECOM Group

Headquarters: Tokyo, Japan

Services offered: Colocation

Annual Revenue: $ 8.7 billion (SECOM Group)

Data Centers: Unknown

Markets Served: Japan

@Tokyo is part of the SECOM Group, a conglomerate of security, real estate and services companies. It has been in business since 2000 and promises its customers "zero downtime, 24 hours a day, 365 days a year."

12. 21Vianet

Headquarters: Beijing, China

Services offered: Colocation, hosting

Annual Revenue: $123.7 million

Data Centers: Unknown; facilities in 30 cities

Markets Served: China

Through a partnership with Microsoft, 21Vianet operates Microsoft Azure and Office 365 cloud computing services within China, and the company also has a partnership with IBM's Bluemix platform. It has won numerous awards and boasts more than 2,000 customers.

13. AT&T

Headquarters: Dallas, Texas

Services offered: Colocation

Annual Revenue: $163.8 billion

Data Centers: 300+

Markets Served: 16 countries on 5 continents

AT&T is, of course, best known as a telecommunications provider, but it also offers data center colocation capabilities, which it groups together with its cloud services. Note that many of its 300+ data centers are available as a result of partnerships it has with other data center providers, including Digital Realty Trust.

14. BT

Headquarters: London, England

Services offered: Colocation, hosting

Annual Revenue: £24.1 billion

Data Centers: 48

Markets Served: Worldwide

BT traces its roots to the very first telecommunications company in Great Britain but now is a global conglomerate with operations in about 180 countries around the globe. In addition to colocation services (which it calls "telehousing"), it also offers a variety of private hosted cloud and hybrid cloud services.

15. Coresite

Headquarters: Denver, Colo.

Services offered: Colocation

Annual Revenue: $400.4 million

Data Centers: 20

Markets Served: 8 U.S. cities

This U.S.-based company offers data center, cloud and interconnection solutions. It has more than one thousand customers, including Verizon, Major League Baseball and Cars.com

16. Global Switch

Headquarters: London

Services offered: Wholesale and colocation

Annual Revenue: £368.8 million

Data Centers: 10

Markets Served: Europe and Asia-Pacific

Global Switch claims to be "the leading owner, operator and developer of large-scale network-dense, carrier- and cloud-neutral multi-tenanted data centers in Europe and Asia-Pacific." It also says that it has the highest credit rating of any data center provider.

17. NTT Communications

Headquarters: Tokyo

Services offered: Colocation, hosting

Annual Revenue: Approximately $100 billion

Data Centers: 140

Markets Served: Global

NTT Communications is a subsidiary of Nippon Telegraph and Telephone, one of the largest telecommunications companies in the world. In 2015, it was named the Frost & Sullivan Asia Pacific Data Center Service Provider of the Year

18. QTS

Headquarters: Chicago, Ill.

Services offered: Wholesale, colocation, hosting

Annual Revenue: $402.3 million

Data Centers: 22 (includes leased and partnered facilities)

Markets Served: North America, Europe, Hong Kong

This U.S.-based company describes itself as a leading provider of secure, compliant data center, hybrid cloud and managed services. It has more than 5 million square feet of data center space and supports many customers in financial services, health care, technology and federal government.

19. Sungard Availability Services

Headquarters: Wayne, Pa.

Services offered: Hosting, colocation, disaster recovery

Annual Revenue: NA

Data Centers: 80

Markets Served: North America, Europe, India

Like many of the other data center providers on this list, Sungard AS has been involved in a complicated acquisition. A company called FIS has acquired Sungard's financial software business, but the company's business continuity, cloud and data center business was spun out as a separate privately held company under the name Sungard Availability Services.

20. Telehouse/KDDI

Headquarters: London

Services offered: Colocation, disaster recovery

Annual Revenue: ¥4,466.1 billion (KDDI)

Data Centers: 48

Markets Served: Worldwide

Telehouse is a subsidiary of the Japanese telecommunications company KDDI. It offers dedicated and shared colocation services, as well as connectivity, cloud services and managed services.




Tags: data center


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