Fortune Wants to Make Wholesale Feel Like Colo

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An aerial view of the Fortune Oregon Data Center in Hillsboro, Oregon, which opens this week. (Image: Fortune Data Centers)

The line between colocation cages and wholesale data center suites continues to blur. This week Fortune Data Centers announced a product offering that is designed to make wholesale space more accessible to colocation customers.

Fortune’s “Rack Ready” offering is optimized for customers seeking between 300 kilowatts and 1 megawatt of critical power, a segment of the market where “retail” colocation companies and wholesale data center providers are increasingly competing for deals. Fortune said the offer targets colocation users who are ready to step up to wholesale, but don’t want to manage the costs or complexity of building out their own suite.

“We’ve listened to the market and believe that there is significant demand for tenants that want the economic benefits of wholesale colocation, but aren’t as keen to engage architects, hire contractors, or commission their own power distribution equipment,” said John Sheputis, CEO of Fortune Data Centers. “Retail tenants really want to place their cabinets and turn them up. Our goal was to create a product that did everything else.”

A key difference is that Rack Ready’s deal terms include a lease rather than a service agreement, as is the case with most colocation contracts. But Fortune is including infrastructure improvements within the suite that would normally be borne by wholesale tenants.

Wholesale vs. Colo

The idea, according to Sheputis, is to offer a simpler comparison between the two deployment models. In the wholesale data center model, a tenant leases a dedicatedt data center suite or “pod”. In colocation, a customer leases a smaller chunk of space within a data center, usually in a caged-off area or within a cabinet or rack.

The wholesale data center model offers greater control and security than shared colocation space, but it’s not a fit for everyone. The economics of wholesale space have historically been most attractive to companies requiring at least 1 megawatt of power capacity for their data center.

But in recent years wholesale suppliers have begun competing for deals of 500 kilowatts and below. This has presented customers with more options – provided they can sort out the apples vs. oranges comparison of deployment models.

Colo Becomes “Wholesale Lite”

The wholesale providers aren’t the only ones fine-tuning their product offerings to acknowledge the changing competitive landscape. The largest colocation provider, Equinix, recently began offering Business Suites – enclosed data center suites for customers requiring larger footprints, effectively a “wholesale lite” offering. Several providers, including QTS and CoreSite, offer both colocation and wholesale space.

To acommodate smaller tenant requirements, Fortune will set up customer cages within larger suites, and work with the customer to design the size, energy density, and phasing of the IT requirement. Fortune will then design, build, and install electrical systems, cages and doors, physical security, ladder racking and aisle containment.

‘We’ve signed deals for RackReady in San Jose and Oregon, confirming our belief that this solution is something the market needs and will welcome,” said Sheputis.

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