A Dissenting Voice on Colo Growth

Lydia Leong from Gartner has a blog post discussing why her growth projections for the colocation market are lower than those from many other analysts. Leong says the hot, high-demand markets aren't telling the whole story.

Lydia Leong from Gartner has a blog post discussing why her growth projections for the colocation market are lower than those from many other analysts. She says that she sees lower growth because Gartner's broad-based analysis of the IT market doesn't support it, and that strong demand may not extend beyond key markets and providers.

"If you’re judging the data center market by what’s happening in Equinix Cities or even Savvis Cities, you’re missing a lot," Leong writes. "If I’m going to believe in gigantic growth rates in colocation, I have to believe that one or more of the following things is true:

  • IT stuff is growing very quickly, driving space and/or power needs
  • Substantially more companies are choosing colo over building or leasing
  • Prices are escalating rapidly
  • Renewals will be at substantially higher prices than the original contracts

"I don’t think, in the general case, that these things are true," Leong continues. "They’re sufficiently true to drive a colo growth rate that is substantially higher than the general 'stuff that goes into data centers' growth rate, but not enough to drive the stratospheric growth rates that other analysts have been talking about."

Read Getting  Real on Colocation for Leong's full commentary.

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