New Q1 data from Synergy Research Group shows that Equinix, Digital Realty, and NTT maintain a strong lead in the colocation market, helped in part by the many acquisitions that they have made. In aggregate the three now control almost 28% of the worldwide market and all have grown their market share over the last four quarters. Equinix and Digital Realty have grown at rates far in excess of the overall market, due to a combination of organic growth and large M&A deals that have closed in the last year. Market leader Equinix had a 13% share of the Q1 market and has subsequently completed two more acquisitions which will help it to further boost its market position in Q2. The closest competitors to the big three are KDDI/Telehouse and China Telecom who both have a 3% market share, followed by a group of operators that each has a 2% share – CyrusOne, Interxion, Cyxtera, Global Switch and Coresite. Across the two major market segments, Equinix had a 17% share of retail colocation, while Digital Realty had a 28% share of the smaller wholesale segment.
The Q1 data, covering both wholesale and retail colocation, shows that the market continues to expand steadily across all regions, with APAC and Latin America having the highest growth rates. When measured in local currencies, the major countries with the highest growth rates are all in the APAC region - China, Hong Kong, Australia, Japan and Singapore. Across the major regions, Equinix was the leader in EMEA and Latin America, ranked second in North America and third in APAC. Digital Realty was the leader in North America and NTT the leader in APAC.
“When it comes to operating data centers and colocation services, scale and geographic reach are important,” said John Dinsdale, a chief analyst and research director at Synergy Research Group. “Enterprises are pushing more of their data center operations into colocation facilities and are also aggressively driving more workloads onto the public cloud, where cloud providers themselves use a lot of colocation facilities. Satisfying the needs of those enterprises and cloud providers often requires a large and widely distributed data center footprint. In order to help achieve that scale there needs to be constant investment in existing data centers, in addition to which we’ve seen $42 billion in data center M&A deals over the last 36 months, with Equinix or Digital Realty along accounting for half of the total. There are good reasons why those two are the leading players in the colocation market.”