Equinix and Digital Realty extend colocation leads through M&A activity

Equinix and Digital Realty have extended their leads in the colocation market, according to the latest note from analyst firm Synergy Research.

The updated note comes after Equinix officially completed the acquisition of 29 data centres from Verizon, a move first announced in December last year, as well as Digital Realty and DuPont Fabros announcing their intention to merge.

Synergy argues the Equinix and Verizon combination accounts for 13% of the overall market – including both retail colocation and wholesale – with Digital Reality and DuPont Fabros hitting 9% share. The latter has wholesale colocation as its primary driver, with the former entirely retail-based.

NTT, the third placed player, has just over 6% of the market overall, while the next largest vendors, KDDI/Telehouse, China Telecom, and CenturyLink/Cyxtera, have just over NTT’s share between them.

APAC continues to be the fastest growing region, with the four quickest growing companies – China, Hong Kong, Japan and Australia – all in the region. NTT leads in APAC, with Equinix and Digital Realty top in Europe and North America respectively.

“The aggressive growth of hyperscale data centre operators and other cloud and hosting companies is helping to drive demand for data centre footprint across all regions, while many enterprise customers require their data centre operators to span multiple metros and countries,” said John Dinsdale, a chief analyst and research director at Synergy Research. “These fundamental market drivers mean that colocation is increasingly a market where scale and geographic scope determines success.

“Equinix and Digital Realty were already growing much more rapidly than the overall market, and these deals will help them to further distance themselves from the competition,” Dinsdale added.

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