With so much focus on colocation in America and how it is creating a new way for business owners to run their company, other countries it is also affecting are getting overlooked. Colocation is currently taking Europe by storm with some of the biggest data centers merging and expanding on what could turn into a global scale.
While the United States has colocation facilities being established across from coast to coast and companies fighting over who is the biggest and best provider, Europe currently has several countries competing for the same title. The United Kingdom, Germany, France, and the Netherlands have the top four colocation markets on the continent with data centers looking to grow and provide service to as many European business owners as possible. Some have figured out that it’s easier to join forces than continue to struggle alone.
Recently a merger occurred between Interxion and Telecity Group, two of Europe’s top data center providers and created a monumental change in leadership. This newly combined company is now a formidable player in the major markets, and is expected to be top ranked in Europe. By joining forces, this company is now the largest in the UK and the Netherlands, and in the top ten largest in France, Spain, Switzerland, and Germany.
The company now holds a 15 percent share of the overall EMEA (Europe and the Middle East) retail colocation market with 80 data centers. This compares to the nine percent held by Equinix, the now-second largest provider and its 32 data centers. Jabez Tan, a senior analyst for Structure Research predicts that the merger between Interxion and Telecity Group will help the company begin to expand globally, focusing on international markets with The United States, Singapore, and Hong Kong.
All of the data companies competing for the title of top provider have established facilities in colocation hubs like London, Paris, Frankfurt, and Amsterdam. There are some, however, that have created facilities in northern Europe in an attempt to cut down on costs.
Saving on Costs
In October 2014 technology research firm Gartner published a press release announcing that IT managers can cut colocation costs by also 50 perfect in the European market by moving north to Scandinavian countries like Norway and Sweden. This took many people by surprise as colocation centers, until this point, had been found in more populated parts of Europe. The two main reasons for this logic are colder climates that make it easier to run servers at low temperatures, and the low cost of power. (Since 2010 energy princes in Sweden and Norway have dropped five percent while the rest of Europe has increased by 13 percent.)
While some people believe that these reasons are enough to begin building data facilities in cold, energy efficient climates, it’s important to remember that there are plenty of other factors that contribute to the success of a colocation center. If one builds a center based on only a couple of them, costs could explode ending in the center’s failure and possible closure.
Location is Everything
Keeping colocation centers in densely populated areas throughout Europe ensures that people with the proper technical qualifications and on-site support will be around to support it. Finding staff members with specific skill sets that will enhance a colocation provider are commonly found right outside of the Arctic Circle. Having a center there instead of a major business center makes it harder to access should something go wrong like a power outage, which could lead to the commencement of a disaster recovery plan.
Although it may save business owners money, going with the least expensive option may not allow them to invest their money where it is needed, like security. Business in Europe includes data laws that vary from country to country, meaning information on servers could be protected in Germany, but not Italy. Security is an important thing to have in Europe, and data centers established in the north are at a higher risk of having inadequate security measures, putting the business at risk.
The colocation market in Europe is growing rapidly. It increases about 10 percent each year with the help of trends in cloud services, outsourcing, video and social networking. It’s only a matter of time before European colocation providers begin to expand to the Americas, giving those providers in the States a run for their money.