Savvis Opens Expanded Singapore Data Center

Managed hosting specialist Savvis Inc. (SVVS) today announced the opening of its expanded Singapore data center, which now spans more than 18,000 square feet of raised floor space. The company said the expansion builds on Savvis’ presence in Asia Pacific and demonstrates “excellent business opportunities and confidence in the market.”

In addition to its full suite of managed hosting services, Savvis will also offer financial customers in Singapore the ability to host their trading applications close to major derivatives markets through Savvis Proximity Hosting, which enables low latency network access to the Singapore Exchange.

“We are pleased to expand our presence in Asia and increase capacity for existing and new customers in the region,” said Phil Koen, Chief Executive Officer of Savvis. “In addition, many of our US and European customers are expanding their businesses into Asia and require Savvis’ flexible IT infrastructure services that can scale globally.”

CMPi in Outsourcing Deal with Savvis

Magazine publisher CMP Information (CMPi) has signed a five-year deal with Savvis Inc. (SVVS), which will host CMPi’s entire critical IT infrastructure. The deal is valued at

Savvis Secures Financing for UK Data Center

Savvis Inc. (SVVS) said today that its SAVVIS UK Ltd. subsidiary has obtained a five-year,

Thomson Reuters Extends Savvis Contract

Managed hosting provider Savvis, Inc. (SVVS) has announced a one-year extension of its master services agreement with Thomson Reuters that includes the deployment of IT infrastructure services in Asia. Savvis also said it has opened its new Chicago data center.

Reuters, a long-time customer of Savvis, was recently purchased by Thomson. The merger created some suspense about the renewal of the contract, which was valued at approximately $50 million. Securities analysts who track Savvis had been keenly focused on the status of the Reuters deal, which represented significant revenue for the company.

Under terms of the agreement, Savvis will continue to serve as an approved vendor to provide managed hosting and managed network solutions to support the collection of exchange data for Thomson Reuters (RTRSY) market data services worldwide, as well as managed hosting services that underpin the flagship ThomsonReuters.com website. Savvis will also provide managed hosting services delivered from its Singapore data center supporting Thomson Reuters expansion activities in Asia.

Savvis Plans New London Data Center

Savvis Inc. (SVVS), will open a new data center in London in response to strong business demand for more space, power and managed IT services in the UK, the company said today.

The data center in Slough, Berkshire is part of a $400 million global investment by Savvis in new facilities and network assets across Europe, Asia and North America over a two year period. The London area facility is scheduled to open in the fourth quarter of 2008.

Savvis said it decided to locate the data center outside the M25 (the London “beltway”) and closer to the grid to “overcome space and power challenges often associated with central London facilities.” The Slough facility will have direct connectivity to SAVVIS’ data centers near Reading and in London’s Docklands, allowing customers in those facilities to store data for disaster recovery. Slough is also the site of data centers for Rackspace and Equinix (EQIX).

Savvis Shares Slide 24 Percent

It’s been a tough morning for Savvis (SVVS). The fallout on Wall Street from last night’s earnings and guidance disappointment has been swift. Savvis shares are down $4.52 to $14.16 a share, a decline of 24 percent from yesterday’s close. Analysts at Lehman Brothers, Jefferies & Co. and Kaufman Bros. all downgraded Savvis this morning after the company lowered its revenue guidance for the year, saying it was taking longer to close sales of managed hosting services.

This morning, the popular news site Slashdot was offline for nearly five hours, along with other sites operated by Sourceforge.net (LNUX). “Some planned downtime from our provider apparently didn’t come back up quite as planned,” wrote Slashdot co-founder Rob “CmdrTaco” Malda. Sourceforge.net’s sites are hosted by Savvis.

Reuters Renewal Looms Large for Savvis

In last night’s conference call with analysts, executives of Savvis (SVVS) said that a number of potentially large customers were taking longer to make decisions about lucrative managed hosting deals. One key deal that’s going down to the wire is a hosting and network services contract with Reuters, which expires next month. Reuters was recently purchased by Thomson, which has created some suspense about the service renewal. Here are comments from Savvis Chief Financial Officer Jeffrey Von Deylen:

Reuters today roughly is about a $50 million account. … Essentially in the past two and a half years, they’ve had an opportunity on the legacy network business to migrate if they so choose and they have decided not to. So we’re working aggressively with them as they think about their Thompson/Reuters merger. … But they haven’t given us any clear signals one way or the other which way they’re going. We’ll continue to work with them and I think we’ll kind of get our niches on the network side, and then continue to try to meet their needs on the hosting side.

There was also discussion of power density in older data centers and its impact on demand for space.

Savvis Cuts Guidance, Citing Slower Sales

Savvis Inc. (SVVS) lowered its revenue guidance for the year, saying it was taking longer to close sales of managed hosting services. The company reduced its 2008 revenue projection to a range of $840 million to $870 million, down from earlier projections of $910 million to $925 million. After closing today’s session down 6 percent at $18.68, Savvis shares fell sharply in after-hours action, trading down $2.73 at $15.95, a decline of 14.6 percent.

“We have begun to see a lengthening pipeline,” said Savvis Chief Executive Officer Phil Koen. “The deals we want are taking longer to close. We also were overambitious with our sales projections for the second half of 2007.” Koen said CEOs and CIOs “are being more cautious with spending in the second half of the year, particularly with the more complex commitment of a buy decision for managed hosting.”

The Savvis results will prompt close scrutiny of earnings reports for other managed hosting providers, as analysts assess whether the slowing sales cycle is specific to Savvis or reflects a broader trend in the uptake of managed hosting services. A key question is whether carrier-neutral providers will fare any better than Savvis, which operates its own backbone and bundles network services and managed hosting.