Market News

January Roundup: Top Five Data Center News Stories

Outages, growth, acquisitions and legal battles have dominated data center headlines so far in 2017. Here’s a quick look at the top five data center news stories that piqued our interest:1. Amsterdam Power Failure Shuts Down Data CentersMuch of Amsterdam was brought to a standstill in January when a widespread power failure shut down transport systems and left thousands of households and businesses without energy for five hours. A State of Emergency was declared as police were sent out to maintain order on the darkened streets and it was reported that two elderly people sadly lost their lives following the power outage.Many data centers in the Dutch capital were forced to activate contingency plans. The Data Center Group said its Amsterdam facility switched over to backup systems, however the operator encountered a fault, leading to the generators failing to start. The company’s CEO, Siemon van den Berg, revealed the fault had materialized in the month since their previous system test.Other facilities, including Global Switch, Equinix, Digital Realty and Interxion said their contingency plans were successful and no customers were impacted. But according to Dutch news agency BNO, a number of locally hosted websites were unavailable during the incident, including the Netherlands’ largest newspaper, De Telegraaf.“This is the second major outage in the region within a period of two years with great harm to citizens and businesses and a disruptive effect on the economy and everyday life,” said Hans Grünfeld from the Dutch Association for Energy, Environment and Water.2. Asia Pacific Data Center Colocation Market Reaches US $9 BillionAPAC data center colocation revenue reached almost US $9 billion in Q3 2016, comprising a staggering 31% of the US $28.9 billion global market. A new report by IT research and advisory firm 451 Research says interest in Asia will grow over the following years, with revenues projected to exceed US $48 billion by 2021.Growth is predicted to be increasingly generated by ‘edge-markets’ outside the global elite. “Over the next one to two years, we expect to see growing interest from top providers and investors in markets outside of the top 20, particularly in Asia and Latin America,” said Kawasaki.451 Research said Equinix and Digital Realty remain the global leaders, holding 9.5% and 5.7% of colocation and wholesale revenue respectively. Equinix’s proposed acquisition of Verizon later this year will see its share increase to 11.4%.Rounding out the top 10 were China Telecom on 3.3%, CenturyLink 2.2%, China Unicom 2.1%, Verizon 1.9%, Dupont Fabros Technology 1.9%, Level 3 Communications 1.8%, Cyrusone 1.7% and Interxion holding a 1.6% share.3. Facebook Announces Third European Data CenterTech giant Facebook revealed its intention to build a new data center in the city of Odense, Denmark. This will be the company’s third facility outside the United States, with existing centers already established in Ireland and Sweden.Lars Lilleholt, Denmark’s Energy Minister, said the announcement highlighted Denmark's strengths, noting that his country boasts one of the world's best green energy ecosystems, with a reliable supply, excellent fiber connections and competitive prices.Facebook purchased the 500,000 square meter site last October, and the facility is expected to be operational by 2020, providing 150 jobs for the local economy. Costing over US $100 million to develop, the center will be 100% powered by renewable energy, with the chilly climate helping to cool equipment in place of traditional mechanical cooling."The Odense data center will be one of the most advanced, energy-efficient data centers in the world," said Niall McEntegart, Facebook’s director of data center operations.4. US Government Loses Fight to Access Emails Held in Microsoft Data CenterA US Court of Appeals upheld its decision to deny the Department of Justice access to information stored in Microsoft’s Irish data center. The legal contest began in 2013 when the department sought to investigate emails from a suspected drug trafficker, but encountered legal resistance from Microsoft.The Court was evenly split in the January vote, leaving its earlier decision unchanged. While acknowledging that the 31-year-old Stored Communications Act is dated, Judge Susan Carney noted that it does not permit global searches under a US warrant.Brad Smith, Microsoft’s Chief Legal Officer, said congress must modernize laws to keep people safe and ensure governments respect international borders. “This decision puts the focus where it belongs, on Congress passing a law for the future rather than litigation about an outdated statute from the past," said Smith.Microsoft has joined forces with other technology giants to sue the Department of Justice for compelling them to conceal requests for private customer data.5. Digital Bridge to Acquire Vantage Data CentersIn a sign of consolidation across the data center industry, Digital Bridge Holdings LLC has reportedly agreed to acquire Vantage Data Centers from Silver Lake Partners for over US $1 billion. Vantage Data Centers was established in 2010 when Silver Lake acquired a facility previously owned by Intel.The deal is to be officially announced this month and comes as players in the sector are scaling up to meet increasing global demand for data. Tech companies are turning to vendors like Vantage to host their infrastructure in a drive to reduce costs.Florida-based Digital Bridge, which also operates telecom infrastructure companies, has raised over US $4 billion in debt and equity since it was established in 2013. In July last year it spent hundreds of millions of dollars to acquire DataBank Ltd, a Texas-based data center organization. The company also owns Mexico Tower Partners, Vertical Bridge, ExteNet Systems, and Andrean Tower Partners.Source articles:

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