European colocation market growth is being driven by retail carrier neutral services, according to a recent report by Synergy Research Group.
While wholesale growth has typically been higher than retail, research shows that wholesale growth rates have been dropping. Carrier neutral retail saw a huge bump in the latest quarter, reaching almost 14 percent year-on-year growth, the highest growth rate the region has seen in five quarters.
In total, the European colocation market grew 11 percent in the quarter.
The research not only indicates healthy growth for retail colocation services in Europe, it also shows that telecoms without carrier neutrality are struggling to keep pace. Retail bandwidth provider growth rates are well below average.
UK remains the largest market, accounting for 27 percent of Q1 revenue, followed by Germany, France and the Netherlands. The top four countries account for 65 percent of regional revenues.
Equinix leads the carrier-neutral retail segment, closely followed by European-centric providers TelecityGroup and Interxion. Those three companies make up the bulk of total revenue, followed by Telehouse and Colt, both of whom are “a long way behind the top three,” according to the analysts.
“Despite the presence of all the major telcos in the European colocation market, the carrier-neutral segment is far larger than the bandwidth provider segment” Synergy analyst John Dinsdale said. “Clearly customers see benefits in having a choice of carriers and consequently the relatively open European market has enabled the growth of pan-European colocation specialists.”