Hyperscale, wholesale, expansions, cloud nodes, earnings
The sector continues to push forward as earnings season plays out and the US Thanksgiving weekend approaches. The week also saw activity in Australia, edge developments and significant data centre expansion and leasing activity.
Australia has been a busy market of late. Digital Realty brought online its third data centre in Sydney, while NEXTDC added a large volume of pre-commitments in its new Sydney data centre. The market in Australia continues to present a long-term market opportunity and Macquarie Telecom intends to pursue it and to that end launched a new data centre business unit. Also on the telco side, but on a global basis, NTT formed a new data centre investment and construction entity. The market opportunity is growing and it is clearly global in nature.
The edge has been the subject of much discussion in the last year or so. But it is increasingly clear things are getting closer to reality. Packet is zeroing in on this opportunity and is set to open an edge data centre at the base of a cell tower in Boston, MA. Edge data centres are moving further out and in Europe, EdgeConneX closed a deal in Poland that will get it closer to the eastern side of the continent. Speaking of Poland, reports say Equinix is set to open its European product development centre in Poland.
The annual AWS show is approaching and Amazon continues to expand its footprint. It provided some updated numbers and confirmed a new expansion in Italy, where it has an interesting roster of customers. AWS also launched a new GovCloud region. The other clouds were somewhat quiet on the expansion side of things, though we did see Microsoft add another ExpressRoute node in London, UK.
Despite all the growth in hyperscale and the maturation of the sector in general, there are still plenty of signs that the total addressable market is healthy. We came across some interesting comments about on-premise data centres. But while there are still plenty of areas of growth out there, the reality of hyperscale continues to take shape. On the recent GoDaddy earnings call, we got some insight into how service providers are benefitting from asset-light models driven by hyperscale.
We continue to look at the numbers coming out of earnings season. In the past week, this included Equinix, Switch, GoDaddy and TeraGo. Equinix continues to move along steadily, while Switch has been sluggish and slowing.