New data from Synergy Research Group shows that the top ten metro areas accounted for 74% of U.S. retail and wholesale colocation revenues in 2016, with New York and Washington DC alone accounting for 31%. Among these top metro areas, Dallas and Washington have seen the strongest revenue growth rate over the last year, closely followed by Chicago. Dallas and Washington both grew at almost twice the rate of the national market. It is notable that the revenue growth rate in Chicago, Dallas, and Washington all picked up strongly in 2016, while the growth rate in Silicon Valley actually cooled down. Across the ten metros Digital Realty is the leader in five, helped by its acquisition of Telx, while Equinix is the market leader in three. Other operators that feature strongly in the market share rankings for these metros include CyrusOne, DuPont Fabros, QTS, CenturyLink, Verizon, Coresite, SunGard, NTT, AT&T, and Infomart.
The research also shows that in Q4 the Washington DC metro (which includes parts of Northern Virginia) overtook New York to become the largest metro market for colocation in the world, though for the full year New York still maintained a narrow lead. They are closely followed by Tokyo and London. In addition to these four, the ranking of the top ten metros in the world for retail and wholesale colocation is rounded out by Silicon Valley, Shanghai, Dallas, Singapore, Frankfurt, and Chicago.
“Colocation is an increasingly global market but also demands highly localized services focused on data center facilities close to clients in key economic hubs. This combination of global and local factors has been a major factor in driving the ongoing industry consolidation,” said John Dinsdale, a chief analyst and research director at Synergy Research Group. “Another key feature in the market is the aggressive growth of cloud which has helped the US wholesale market to grow twice as rapidly as retail colocation.”