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07 April 2017
| Jason Mcgee-Abe
Dallas and Washington DC are the two highest growth major metro-level colocation markets in the US, according to Synergy Research Group’s latest report.
Both markets grew at almost twice the rate of the national market, closely followed by Chicago and Atlanta. It is notable that the revenue growth rate in Chicago, Dallas and Washington all picked up strongly in 2016, while the growth rate in Silicon Valley actually cooled down.
Across the ten metros Digital Realty is the leader in five, helped by its acquisition of Telx, while Equinix is the market leader in three. Other operators that feature strongly in the market share rankings for these metros include CyrusOne, DuPont Fabros, QTS, CenturyLink, Verizon, Coresite, SunGard, NTT, AT&T and Infomart.
“Colocation is an increasingly global market but also demands highly localised services focused on data centre facilities close to clients in key economic hubs. This combination of global and local factors has been a major factor in driving the ongoing industry consolidation,” said John Dinsdale, a chief analyst and research director at Synergy Research Group.
“Another key feature in the market is the aggressive growth of cloud which has helped the US wholesale market to grow twice as rapidly as retail colocation.”
The rapid growth of cloud continues to drive heavy investment in data centre facilities, while the combination of global and local requirements helps to fuel industry consolidation. In the US Digital Realty and Equinix are clear market leaders both generally and in the major metro areas. One of them leads in eight of the top ten US metros.
Looking at absolute scale, New York and Washington DC combined account for almost a third of the total US market, and five US metros appear in the worldwide top ten ranking of local colocation markets.
New Synergy data from shows that the top ten metro areas accounted for 74% of US retail and wholesale colocation revenues in 2016, with New York and Washington DC alone accounting for 31%. Among these top metros Dallas and Washington have seen the strongest revenue growth rate over the last year, closely followed by Chicago.
In Q4 the Washington DC metro (including parts of Northern Virginia) overtook New York to become the largest metro market for colocation in the world, though for the full year New York still maintained a narrow lead. They are closely followed by Tokyo and London. In addition to these four, the ranking of the top ten metros in the world for retail and wholesale colocation is rounded out by Silicon Valley, Shanghai, Dallas, Singapore, Frankfurt and Chicago.