BIG 4 MARKET PRESENCE IN EUROPE AND ENERGY SUPPLY DIFFERENTIATE DATACENTRE WINNERS
London, 21 June 2012 – Presence in all four major European markets, and power supply will differentiate winners in the Datacentre market by 2016. However, outsourcing growth across the next 3 years will fall only slightly short of the US level of 30%. The conclusions are drawn in a major new report by consulting firm BroadGroup, Datacentres Europe IV.
In this new update of the 2010 report, datacentre market forecasts across 17 Western European countries, key suppliers and industry issues have been analysed. The report believes that Europe is now in its third stage of evolution with datacentres targeting vertical segments such as cloud, media, and other financials presenting a more challenging marketing proposition.
The report predicts that huge focus will be sustained on the “Big 4” markets of London, Amsterdam, Frankfurt and Paris which in the first quarter of 2012 represented around 85% of datacentre Capex. Regional expertise is a competitive differentiator, and as obsolescence will threaten poor quality facilities who fail to improve their PUE rates, pan-Europeans have the opportunity to advance their vertical market expertise and leverage cost, technical and managed services differentiation.
The report forecasts that the importance of the “Big 4” markets will increase over the next three years before ending in 2016 at virtually the same share of 3rd party datacentre space. This reflects the continuing focus on the major markets, and the current investment plans of the major players. Significant growth will occur in the wholesale datacentre segment and carrier neutral facilities across the next 3 years.
While procurement requirements become smaller, shorter and more integrated with other IT (and cloud) sourcing requirements, BroadGroup predicts for the first time, that strong pressure exists to increase pricing of datacentres from 2013 onwards.
“Existing players will be focused more on maximizing returns from existing assets,” commented Steve Wallage, managing director of BroadGroup Consulting. “Outside of the main players, funding will remain difficult for unproven and speculative schemes, particularly those dependent on an anchor tenant.”
The report also suggests that space is increasingly an unreliable and arguably misleading metric for datacentres. Competitive positioning is now more about adding power rather than space. Hence, power will show a more consistent and stronger growth than third party datacentre space.
New locations are aggressively marketing their competitive advantage and the report cites Norway, Ireland, Switzerland and other locations with renewable energy resources who are seeking to attract datacentres. Power supply remains a concern across all markets in the report. In the UK for example, reliance on gas imports could lead to brown-outs by as early as 2013.
In contrast to 2010, cloud now represents more significant opportunities. Although datacentre players are re-positioning themselves in the cloud value chain, BroadGroup sees some dangers in shifting to become a full cloud service offering.
Overall the report is invaluable for companies engaged in the datacentre sector and provides forecast data to 2016 for 17 West European countries, broken down by segment, key current suppliers and expected future build. It also provides a unique comparison and rating of key datacentre suppliers across a range of criteria.