In Podcast 34, we dive into the European data center market trends that we witnessed in the third quarter and talk about their future.

We’ve been tracking the major European data center markets for several quarter it’s been interesting to look back and see the changes that have occured during 2020,. In this podcast, we dive into some of the third quarter specifics of the European markets and also look forward to 4Q and into 2021.

If you’re short on time, check out a few of our quick takeaways below.

Development activity during COVID-19

We saw growth and demand across all the European data center markets in the third quarter. Generally, there was a significant amount of development and leasing activity in these markets even during this COVID-19 environment.

The European markets are continuing to be a strong area of growth and look to be in place for more interest moving forward.

The Frankfurt data center market continues to grow

Frankfurt continues to be an attractive location for data center providers and users moving forward into the rest of 2020 and beyond. One data point that shows this is that it has a lower population with a high density of data centers. Looking at the overall power usage in the city, some estimates show that 35-40% of the power in Frankfurt goes directly to powering data centers. This is a massive jump compared to other major data centers markets with larger populations such as London.

What the future looks like for the European markets

Predicting the future is always tricky, especially when it comes to the European data center markets.

Growth in the data center industry happens when deals get done. This can make figuring out how much growth to expect in a quarter difficult to determine with precision. A good way to get an accurate feel of a market is by finding out if there are a number of deals pending and waiting to get done.

In the European markets specifically, there are a lot of pending deals which we expect to lead to good growth in the future.

Wrapping up, the European markets continued their growth in the third quarter with the Frankfurt market specifically standing out as an area of consistent activity. The European data center markets as a whole should have a strong fourth quarter as well as continued growth in 2021.

LightEdge started out as an ISP and fell into becoming a data center company which led them to build a data center inside a limestone mine and expanding to 3 colocation facilities. Here’s the story of how they got there.

This is an episode of HawkTalk, datacenterHawk’s series of candid one on one conversations with executives and leaders in the data center industry. If you enjoyed this episode, you can check them all out on our blog.

LightEdge began their journey in the data center industry after starting out as an internet service provider and then out of necessity building and operating their own colocation facility. Since then they have become a data center provider with multiple facilities across the US that focus on compliance.

If you’re short on time, check out a few of our quick takeaways below.

LightEdge’s entrance into the data center industry

LightEdge started out as an ISP, but built their first data center in Des Moines, Iowa out of necessity after they deployed their first cloud platform. They partnered with a construction company and built a data center because at that time the idea of a colocation facility had yet to become as wide spread as it is today.

Growth into the Kansas City market

LightEdge had maxed out the first facility they built with 4-5 years, so they decided to expand into Kansas City with another building. LightEdge got connected with Lamar Hunt and his family, who committed to filling 800,000 SF of data center space if they were to build a Kansas City facility. With that commitment, LightEdge began construction of their 2nd data center which is located inside of a limestone mine that is owned by the Hunt family.

Acquiring a third facility in Omaha

After building facilities in Des Moines and Kansas City, LightEdge looked to add a 3rd facility to their profile and wanted it to be near their already existing data centers. After surveying options, they settled on building in Omaha because that location would give them a good triangulation between their other two data centers and offer similar hazard risk as their other facilities.

Growth for data center providers is a must, and partnering with hyperscale users can immensely benefit that growth. Get the inside details of what these relationships look like from Bill Fathers, CEO of Cologix.

This is an episode of HawkTalk, datacenterHawk’s series of candid one on one conversations with executives and leaders in the data center industry. If you enjoyed this episode, you can check them all out on our blog. If you’d like to know when we release future episodes, you can subscribe to our channel.

Cologix has made it a goal to own the most connected facilities, known as carrier hotels, in the markets they’re in. Bill Fathers, CEO of Cologix, sits down and discusses this and other strategies they have and how they plan to grow in the future.

If you’re short on time, check out a few of our quick takeaways below.

The recent area of growth for Cologix

Cologix has kept the same value proposition for its customers over the past 20 years with a focus on network dense carrier hotel type facilities.

The Cologix customer enters their facilities for one of two reasons, they want access to a dense number of carriers, and they want to connect to other Cologix customers.

This is made more interesting with the rise of public cloud. Cologix’s number one customer type has shifted to the major cloud service providers, such as Amazon, Microsoft, Google, etc. who all want to be connected to one another and because Cologix already operates highly connected carrier hotels, the relationship makes sense.

Hyperscale growth in the Columbus market

Cologix has seen the interest from major Hyperscale users such as Google, Facebook, and Amazon in the Columbus market.

Columbus offers a central location as well as tax incentives aimed at data centers, so it makes sense that these large companies have built 600+ acres of data center space in this market. This has been a welcome sight for Cologix since they already developed and owned the carrier hotel in Columbus before the interest from the hyperscale users.

With the massive increase in traffic that their carrier hotel has seen, Cologix has decided to build an additional 24MW facility to accommodate other cloud service providers.

Cologix’s presence in Canada

Montreal first piqued the interest of Cologix because of its extremely low cost of electricity as well as it being a high percentage of renewable energy.

One of Cologix’s first acquisitions was to acquire the carrier hotel in Montreal, and shortly after they grew into the Toronto and Vancouver markets as well.

Their first goal for these markets was to own the carrier hotel environments there. Then after five years they implemented their second phase of growth which was to add additional facilities in each of these markets. Moving forward, Cologix has started building new 30MW+ build to suite facilities specifically for hyperscale users in Montreal, & Toronto.

As cloud service providers have risen to prominence, their connectivity requirements have matched up well with data center providers who focus on connectivity, like Cologix. Bill Fathers and his team hope to continue growing along side these prominent cloud service providers that are changing the industry.

Digital Crossroads CRO, Bill Winsininski, unpacks the Chicago data center market and talks about some of the innovations at their newest facility in the market - that resides in Indiana.

This is an episode of HawkTalk, datacenterHawk’s series of candid one on one conversations with executives and leaders in the data center industry. If you enjoyed this episode, you can check them all out on our blog. If you’d like to know when we release future episodes, you can subscribe here.

On HawkTalk 53, Digital Crossroad’s CRO Bill Winsininski joins David Liggitt to discuss the Chicago data center market as well as their new facility that is slated to go live in 4Q this year. The facility, even though it’s located in Indiana, is less than 15 fiber miles away from downtown Chicago and is directly connected to the carrier hotel in Chicago, 350 E. Cermak.

If you’re short on time, check out a few of our quick takeaways below.

Characteristics of the Digital Crossroad facility

The Digital Crossroad facility is located on Lake Michigan which they take full advantage of by using 900 gallons of water per day from the lake as a cheap and renewable source of cooling, not to mention the views the lake provides.

Digital Crossroad has big plans for its campus just outside of Chicago, including 1.7 million square feet in its final stage. Phase 1 of the campus is planned to go live this October with their first 20 megawatts.

Chicago will be looked at by bigger data center users moving forward

One of the most effective ways for states to bring economic activity to a market is to add incentives. The state of Illinois did just that when they put in place tax incentives that would eliminate sales tax for data center providers who invest at least $250 million dollars to building data center facilities in the state.

This is a clear attempt to attract new IT investment, and it seems to be likely that more of the bigger data center providers and users who are looking to build new facilities will give Illinois and the Chicago market more looks.

Future data center industry trends

Bill has been in this industry for a long time and has seen it grow to what it is today, we took the opportunity to get his predictions on where it’s going to go in the future.

The constant change and improvement in technology is the primary trend for Bill. 5G will continue to become more widespread and relevant, which will make the overall speed of wireless technology increase exponentially.

Specifically, in this time of COVID-19, we’ve seen how so many people have begun to utilize technology more in their daily lives whether their ordering groceries online or jumping on a video conference with co-workers. We’re truly seeing a paradigm shift in the way people use technology in their daily lives.

In Podcast 33, we continue our Data Center Fundamentals series and dive into the basics of data center infrastructure.

Electrical Infrastructure (Power)

Electricity travels along what’s called the power chain, which is how electricity gets from the utility provider all the way to the server inside the data center. A traditional power chain starts at the substation and eventually makes its way through a building transformer, a switching station, an uninterruptible power supply (UPS), a power distribution unit (PDU) and a remote power panel (RPP) before finally arriving at the racks and servers. Data centers also utilize on-site generators to power the facility if there is an interruption in the power supply from the substation.

Think of a data center like a giant laptop. The main power cord comes out of the wall (utility power) and is then transformed into usable power for the laptop (little box in the middle of your laptop cord). Finally, if any of the components of the cord fail (main power outage, transformer failure), the laptop has a battery to provide temporary power.

Mechanical Infrastructure (Cooling)

The amount of power a data center can consume is often limited by the amount of power consumption per rack that can be kept cool, typically referred to as density. In general, the average data center can cool at densities between 5-10 kW per rack, but some can go much higher.

The most common way to cool a data center involves blowing cool air up through a raised floor, which is pictured above. In this setup, racks are placed on a raised floor with removable tiles, usually three feet above the concrete slab floor. Cool air is fed underneath the raised floor and is forced up through perforated tiles in the floor around the racks. The warmer air coming out of the servers rises up and is pulled away from the data hall, run through cool-water chillers to cool it, and fed back beneath the raised floor to cool the servers again.

In certain climates, data centers can also take advantage of “free cooling” where they use the outside air to cool the servers. Instead of taking the hot air and cooling it to be used again, they allow the heat to escape and pull in the cool air from outside. This process is, as expected, much cheaper and energy efficient than operating more man made cooling infrastructure.

Connectivity Infrastructure

A data center’s connectivity infrastructure is also important. Without it, a data center would just be a building full of computers that can’t communicate with anyone outside the building.

As data centers are the primary foundation for activities happening online, the buildings themselves need to be highly connected. Access to a variety of fiber providers connects a data center to a wide network able to provide low latency connections and reach more customers.

Fiber traditionally runs into a data center through secured “vaults” and into the building’s meet-me-room or directly to a user’s servers. A meet-me-room is a location where fiber lines from different carriers can connect and exchange traffic.

Redundancy

Redundancy is communicated by the “need” or “N” plus the number of extra systems. The example above would be considered N+1. The data center needs 10 chillers and has one extra, thus it would be labeled as N+1. If the data center above had 10 extra generators in addition to the 10 they needed to operate, their redundancy would be double their need, or 2N.

Redundancy applies to most aspects of a data center, including power supplies, generators, cooling infrastructure, and UPS systems. Some data centers have multiple power lines entering the building, or are fed from multiple substations to ensure uptime in the event a line is damaged somewhere. The same approach can be taken with fiber lines.

Data centers support the internet ecosystem that more and more of the world relies on today. As such, they require robust infrastructure to ensure there’s no interruption in the services they provide.

The internet doesn’t magically float through the air from continent to continent, it travels via giant cables at the bottom of the ocean. Get an insiders perspective from Gil Santaliz, CEO of NJFX, a cable landing station in Wall, New Jersey

You don’t often associate Wall, NJ with Europe and South America - but for NJFX, they’re more connected than you think. Gil Santaliz is CEO of NJFX, a data center and subsea cable facility in Wall, NJ that has access to cable directly connected to multiple points in Europe and South America. We got his take on the data center industry as a whole and specifically in Northern New Jersey in our latest HawkTalk video.

If you’re short on time, check out a few of our quick takeaways below.

Why cable landing stations are significant to the data center industry

Cable landing stations represent the transmission of 99% of global internet traffic. These stations are where the subsea cables land and connect continents. NJFX specifically, located in Wall, New Jersey, is a landing station for 4 cables. These 4 cables, connecting North America to Ireland, Denmark, Norway, The UK, and Brazil.

Trends in the Northern New Jersey data center market

datacenterHawk has recently seen an uptick in activity, specifically from financial companies in the Northern New Jersey data center market. From Gil’s perspective, the recent changes in the culture due to Covid-19 in New York has made it difficult for people with any interest to get to the data centers in the market. As a result, activity has been spilling into adjacent markets like Northern New Jersey.

Future trends in the data center industry

In the US, data centers have consistently grown in areas where there are tax incentives attracting data center companies to build. Areas that have not had these types of programs in place have seen the missed opportunities of having data centers built in their regions. However, these same regions have seen a slow increase in property taxes, negating some of the benefits of the original tax incentives. This could cause states and areas with no property taxes, like New Jersey, to attract more data center activity.

In Podcast 32, we continue our Data Center Fundamentals series and answer the question “What is the cloud?”

The most simplified way to describe the cloud is the use of virtual servers versus the use of physical servers. Utilizing someone else's IT infrastructure instead of having it yourself describes how people use the cloud today.

If you’re short on time, check out a few of our quick takeaways below.

Operating in the cloud has distinct advantages, primarily driven by the absence of physical infrastructure and the associated CAPEX. Instead of physically commissioning and installing new servers as you would with colocation, cloud servers can be deployed almost immediately and at a lower initial cost. Users also have easier access to their cloud ecosystem and can interact online instead of physically managing the servers from inside the data center.

There are three use-cases of the cloud: private cloud, public cloud, and hybrid cloud. Each one has their own benefits and challenges.

Private cloud

Private cloud is your most controllable type of cloud deployment. Typically this is infrastructure in an area where you know where the physical servers are and they are dedicated just to you. This allows access only to the hypervisor or software layer that assigns workloads to the physical servers, but physical servers are only accessible by a single tenant.

Public Cloud

With public cloud you might not know exactly where your physical servers are, but you know the region they’re in. In contrast with private cloud, physical servers may be shared by multiple customers. This allows access to your data when you need it with a lower latency in that particular region. Some examples of companies who utilize public cloud include Azure, AWS, Google Cloud Platform, IBM Softlayer.

Hybrid Cloud

Hybrid cloud is exactly what it sounds like. It can be a mixed use of public, private, colocation, and even some on premise IT services. Companies will typically use a hybrid cloud approach to accommodate applications with different requirements around security, latency, etc.

Almost every company utilizes the cloud in some capacity. It solves problems that leasing physical servers can’t. Instead of housing a handful of racks on premise or going to colocation, now most small companies deploy their systems straight to the cloud and large companies utilize the cloud in various operations.

While the cloud has taken some requirements away from colocation, it has substantially increased the demand for colocation overall. In fact, cloud adoption is one of the biggest sources of data center absorption, based on our analysis and discussion with top providers, and we expect to see that trend continue.

Other things we talked about:

-The benefits and challenges of the colocation side of the cloud

-How COVID-19 has changed how businesses utilize the cloud

-The reality of the cloud take over

Becoming the CEO of a company is no easy task, especially in the middle of a pandemic. Evoque’s new CEO, Andy Stewart tells us about the process and where he plans to take Evoque in the future.

As Evoque’s new CEO, Andy Stewart gives us insight to what it has been like assuming the executive role during this strange time. He comes from a CFO position at TeirPoint from which he can be credited for helping build from its one data center to now having dozens all across the US. He discusses what has led him to this current opportunity and what his plans are for the future of Evoque.

If you’re short on time, check out a few of our quick takeaways below.

Hyperscale growth has been a trend we’ve seen, but Evoque has a different plan

Evoque has been a retail enterprise data center provider since it’s beginning. That’s what they’ve based all of their facilities on and that’s the customer segment they will continue to pursue moving forward. Hyperscale users get a lot of attention, and in that attention are data center providers who look to land those big MW deals. Andy tells us that Evoque plans to pursue and have relationships with the hyperscale companies, but they’re going to keep the enterprise users as their main focus and double down on them for the 2nd half of 2020.

Evoque & datacenterHawk both think enterprise activity will grow in the 2nd half of 2020

The enterprise sector of the data center industry was no doubt affected by COVID-19. These enterprise businesses put more focus on the safety of their employees rather than their IT infrastructure needs. As time moves forward and there is more clarity around COVID-19 and what the future will look like, you should expect to see enterprise activity pick back up and make up for the pause in the first half of 2020.

The importance of connectivity

The decisions of where to put your IT equipment, how to manage your network, how to manage your public cloud are all choices that need to be thought about in the same conversation. When Evoque bought their data centers from AT&T they were faced with the challenge of not being highly connected. Over the last 18 months, Evoque has focused its strategy on bringing in more high quality, globally-connected carriers into their facilities to make them more carrier-neutral and carrier dense.

We also talked about…

The challenge of becoming a CEO during a pandemic

Evoque has data centers in Singapore and Hong Kong, which put them in a position of being able to learn from those first lockdowns and put into practice a more advanced strategy when lockdowns happened in other areas of the world.

What data center providers can do to not only help their customers today but also in the future

Don’t forget to check out the rest of our HawkTalk's and don’t miss out on our latest release of market data for the data center industry.

This is an episode of HawkTalk, datacenterHawk’s series of candid one on one conversations with executives and leaders in the data center industry. If you enjoyed this episode, you can check them all out on our blog. If you’d like to know when we release future episodes, please subscribe.

We recently hosted Russell Cozart, Senior Vice President of Marketing and Product Strategy at Cyxtera as part of our HawkTalk series. Russell started in the data center industry 15 years ago with Terramark and has spent time at Dell, VMWare, and prior to joining Cyxtera, managed GE’s cloud hosting portfolio.

We covered topics like what it looked like to launch Cyxtera three years ago, the trends that are informing their go to market strategy now, and his read on the challenges enterprise IT leaders are having today.

You can check out the full interview in the video above, or if you’re short on time, skim some of our top takeaways below.

Focus On Focus

After acquiring Century Link’s data center assets, the Cyxtera team focused on how they could make and deliver data center products and services better - and faster. Russell summarized it as the team asking themselves: how do we deliver the core value that we want to deliver with the combination of innovation, stability, and resiliency that customers had come to know with the Century Link data center asset?

Part of that required a renewed focus. For example, the data center team spun their cyber security offerings off into separate companies so that they could focus more on delivering a world class experience to their enterprise customers.

COVID-19 Has Accelerated, Not Changed, IT Mandates

Particularly with COVID-19, the mandates placed upon CIOs and IT teams have remained the same - just accelerated. Everyone is asking how they can get to Point B faster.

These leaders are looking for partners that can help them as they start to charge faster down the path of digital transformation. That trend of transformation is likely to hockey stick, especially around people using a hybrid combination of public cloud and colocation.

IT Challenges Remain The Same

While IT mandates remain the same, so do the challenges of the enterprise data center user.

CapEx budgets are shrinking, many are supporting aging legacy infrastructure, and the drive to a hybrid IT strategy has left many with skills gaps and complex solutions. These have historically been challenges in the enterprise IT space, but now with COVID-19 the pressure is heightened.

At the same time, leaders are trying to get what they need without sacrificing core tenants of delivering on their own IT strategy, like staying flexible and agile while being fast to market. This flexible and agile environment is top of mind for a provider like Cyxtera as they think about bringing products to market.

How To Build Products That Resonate With Customers

Maintaining a solid roadmap that leads to successful products across the globe takes work.

Cyxtera has a presence across 29 markets globally and has invested heavily in developing an intimate understanding of their customers and their challenges. This enables them to then map out an architecture that will assist their customers in their journeys and ultimately ingest it into Cyxtera’s roadmap to ensure they bring valuable products to market.

Looking Forward

Looking forward, “the next 3-5 years are going to be game changing for the industry”, Russell says. Data center providers are on the precipice of major changes, driven primarily by the changes we’re seeing in the enterprise.

The next 3-5 years are going to be game changing for the industry.

Russell Cozart Senior Vice President of Marketing and Product Strategy at Cyxtera

“[At Cyxtera, we’re] excited to deliver the cutting edge and make sure that’s something that resonates with customers. Their lives are changing and that’s for us and the industry as a whole make sure we’re there.”

1623 Farnam’s president Todd Cushing discusses the importance of carrier hotels and connectivity

This is an episode of HawkTalk, datacenterHawk’s series of candid one on one conversations with executives and leaders in the data center industry. If you enjoyed this episode, you can check them all out on our blog. If you’d like to know when we release future episodes, you can subscribe here.

On HawkTalk 49 David chats with Todd Cushing about 1623 Farnam and what it means to be a carrier hotel in today’s data center industry. They discuss the importance of connectivity as it continues to be a higher priority to businesses today, and the growth of the Omaha data center as a whole.

If you’re short on time, check out a few of our quick takeaways below.

The value of the carrier hotel

Carrier hotels are places where connectivity lives, whether it’s regional, long haul, dark fiber, or another type, the carrier hotel is a location for it all to aggregate. Connectivity has become an important factor in the last 5-10 years as businesses have learned to create mature IT infrastructure that ultimately allows their business applications to work more efficiently.

1623 Farnam - a rich ecosystem of connectivity

1623 Farnam has become a crucial part of connectivity growth in the Midwest. The company is focused on a better network, lower latency, and faster connectivity. The growth of fiber in Omaha is a big reason why 1623 Farnam has put so much of their focus on connectivity. With the fiber infrastructure continuing to grow they see it as an opportunity to control fiber access in Omaha.

The Omaha data center market and why it’s growing

It’s not surprising the recent major growth has come from hyperscale users. From social media companies to major search engines, they’ve all established a presence in Omaha which is causing continual growth to the area.

We also talked about…

The transformation of 1623 Farnam, from a bank building to Omaha’s carrier hotel

Todd’s prediction of the creation of data in the coming years

The impact of COVID-19 on the data center industry

Don’t forget to check out the rest of our HawkTalk's and don’t miss out on our latest release of market data for the data center industry.