Colocation services companies bank on hybrid IT

Providers expand capacity and global presence as enterprise customers build data center services into multi-faceted infrastructure strategies; other IT channel news.

Colocation services providers, gearing up for growth, are increasing capacity, expanding global reach and keeping an eye on sustainability.

Considering the following developments:

  • Flexential, a provider of colocation, cloud and connectivity in Charlotte, N.C., last week disclosed plans to add 33 megawatts of data center development projects in 2022, which the company said is more than twice the rate of its U.S. expansion last year.
  • DataBank, a colocation, connectivity and managed services provider based in Dallas, said it will expand its San Diego data center by 40,000 square feet, tripling its current space.
  • Cyxtera, a colocation provider based in Coral Gables, Fla., last week told investors it will focus on "geographic expansion opportunities" as one of its 2022 priorities and listed Frankfurt, Germany, among its fastest growing markets.
  • Equinix, a colocation and interconnection services provider, plans to close its acquisition of four South American data centers in the second quarter. The company is buying those assets from Empresa Nacional De Telecomunicaciones, a Chilean telecommunications firm.
  • The Nordic nations have emerged as a data center services market, with the availability of renewable energy playing a key role.

Those examples underscore the expansion of the global colocation industry, which Verified Market Research predicted will grow at a compound annual rate of 14% through 2028. The research firm expects the market to hit $127.9 billion that year. Colocation service providers vying for those dollars play a dual role in the channel: They serve as IT service providers, providing data center space and managed services to customers, but also partner with channel companies that recommend or resell their colocation services.

Part of the whole

Colocation's growth stems from enterprise adoption of hybrid IT. Organizations increasingly deploy their IT resources across a mix of public and private clouds. Colocation occupies one tier in that approach.

"As more and more customers shift toward distributed, hybrid and multi-cloud architectures, this drives growth and scale in our market," David Hall, fellow for technology and architecture at Equinix.

He said that's largely because data centers provide the capacity needed to run business' digital services, while keeping cost in check and reducing latency. The latter has become a "huge factor" with many workloads moving online, he added.

More support for Hall's view comes from an Equinix-Gartner study. The companies' research predicted that, by 2025, 85% of infrastructure strategies will integrate on-premises, colocation, cloud and edge delivery options. That compares with 20% of strategies that used those methods in 2020, according to Hall.

Kim Gunnelius, chief commercial officer and co-founder at Ficolo, also forecast significant growth for colocation services, which he said are integral to managing an enterprise's multi-layered requirements. Ficolo, based in Finland, provides colocation and managed public cloud services.

"We've seen enterprises looking for solutions that are based on multi-cloud and hybrid cloud platforms," Gunnelius said. "We expect this trend to continue as corporate leaders understand that there is no single best cloud solution."

Nordic providers such as Ficolo pursue a market featuring double-digit growth. Arizton Advisory and Intelligence, a market researcher based in Chicago, predicted the Nordic data center market will expand at a compound annual rate of nearly 12% through 2027.

Colocation providers and sustainability

We've seen enterprises looking for solutions that are based on multi-cloud and hybrid cloud platforms.
Kim GunneliusChief commercial officer and co-founder, Ficolo

As the need for colocation services increases, so does the demand for sustainability. Data centers contribute to the IT industry's carbon footprint, but service providers have begun to pursue green computing.

Sustainability's importance will continue to grow as more companies set climate neutrality targets, Gunnelius said. "Sustainability issues have moved from a marketing and secondary priority to a core component of most companies' vision," he noted.

Ficolo has received a Climate Neutral Company certification from South Pole, a Swiss carbon finance consultancy.

Equinix's Hall said he expects colocation companies to more aggressively integrate sustainability innovations into data center and digital infrastructure deployments.

"With so many companies in the industry now committed to becoming net-zero, it's very likely that nearly all data centers will be powered by 100% renewable energy within the decade," Hall said.

With that in mind, Equinix recently joined the European Union's Clean Hydrogen Partnership, which will fund a project to develop low-carbon fuel cells to power data centers.

Petition opposes revised Microsoft partner program

A Change.org petition invites partners to disapprove of Microsoft's revised partner program.

The Microsoft Cloud Partner Program, which introduces new qualification criteria for channel companies and a partner capability score, will launch in October 2022. The petition states achieving the minimum score of 70 points will be impossible "for the vast majority of partners." Nearly 600 partners had signed the petition as of March 28. While those partners object to the overhauled partner program, others view it as less complicated than the current edition.

Microsoft has some history with petitions. A 2019 partner petition opposing a new internal use rights policy helped persuade the company to walk back that change.

MSP World: Organizations target MSP security talent gap

MSPAlliance is partnering with Boise State University in Idaho and security software company Stellar Cyber to address the cybersecurity talent gap among MSPs.

The organizations, in conjunction with the MSP World conference last week in Orlando, unveiled plans to launch a program that will create MSP-specific business, technical and cybersecurity training. The program will also offer job placement tools. The goal is to create a pool of MSP security job candidates within the year.

Vendors exhibiting at MSP World included Devolutions, a software developer based in Lavaltrie, Canada. The company, which sells through MSPs and managed security services providers, demonstrated a new module for its Devolutions Server privileged access management offering. The module, Devolutions Gateway, lets organizations replace Microsoft Remote Desktop Gateway, which the company said can be vulnerable to security breaches.

Merger and acquisition updates

  • In a bid to bolster its hyper-automation offerings, Accenture has agreed to acquire the digital engineering and operational technology capabilities of Transcom ITS. Accenture will obtain systems integration, consulting, software development and outsourcing resources in the transaction. Transcom ITS is a Japanese logistics technology services provider and a subsidiary of Transcom, a logistics company. When the deal closes, about 190 Transcom ITS engineers will join Accenture Industry X in Japan. Industry X is Accenture's industrial digital transformation
  • InterVision, an IT services provider, has acquired Virtuosity Consulting, a company with operations in the U.S., Europe and India. Virtuosity Consulting, based in Bellevue, Wash., has offices in India and Kosovo, as well as the U.S. The consultancy focuses on services such as business and process automation, software engineering, system integration and Web 3.0
  • Sourcepass, a New York company that invests in MSPs, made its second acquisition this month, buying Suite3. The acquisition of the Easthampton, Mass., company expands Sourcepass' presence in the Northeast and adds to its business in the financial services industry. Suite3 offers services including managed network, cloud migration and management, cybersecurity and IT support. Earlier this month, Sourcepass acquired Network Solutions and Technology Inc., an IT services firm with clients in New York, New Jersey and Connecticut.
  • Upstack, a web platform that sells cloud services through sales agents, has purchased Meridian Network Services, a telecommunications agency in California that works with SMB and enterprise customers.

Other news

  • SADA, a business and technology consulting firm based in Los Angeles, has expanded its SaaS Alliance Program. New partners include Authentic8, IronClad, LumApps, MariaDB Corporation, Rollbar, Teradata, Thentia Cloud and TigerGraph. The program, which debuted in 2021, provides Google Cloud Platform optimization services and go-to-market support for SaaS providers. New additions to SADA's SaaS program include integration services, which the company said helps partners launch offerings in Google Cloud Marketplace.
  • Presidio Inc., a digital services and solutions provider headquartered in New York, inked a strategic collaboration agreement with AWS. The companies will work together through Presidio's @ Disruptor Speed initiative. In that effort, Presidio will increase training for its sales and technical teams to become cloud-practitioner-certified and expand AWS delivery capabilities to support medium-sized and large organizations. Presidio also aims to expand its MSP business model with AWS and extend its AWS solution practices.
  • Three Involta data centers and managed infrastructure platforms have achieved HITRUST risk-based two-year certification for information security in Boise, Idaho; Marion, Iowa; and Akron, Ohio, adding to three previously certified locations. The certification denotes the MSP's facilities and systems meet industry standards and regulations for data protection and managing risk.

Executive appointments

  • Perception Point, an Israeli data security company, appointed Orit Shilvock as its vice president of channels and strategic alliances to expand the company's global partnership program. Shilvock previously managed partnerships for Nice Systems, Qognify and Checkmarx and brings 25 years of experience.
  • Lacework, a cloud security company in San Jose, Calif., has appointed Brian Lanigan as vice president of worldwide channels and alliances. He joins the company from Splunk, where he led global strategic alliances.
  • TBI, a technology distributor based in Chicago, appointed Samantha Zuniga-Juarez as vice president of partner and supplier experience. She joins the company from Fusion Connect, where she was vice president of channel operations and programs. In addition, the distributor promoted Joe Fizor from solutions engineer manager to director of solutions engineering.

Additional reporting by Kristen Gloss.

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