M&A, public cloud expansions, enterprise cloud adoption, sector debates and shorts
It was another quieter week coming out of long weekends in the US and Canada, but there were a number of notable developments around hyperscale cloud expansion and M&A, while there continues to be conversation and debate about the future of the industry.
In M&A, Green Mountain in Norway entered the UK through the acquisition of assets formerly of Infinity SDC, while on the channel side of the game, Telarus picked up another wholesale supplier.
There were a number of new cloud regions that came online in global markets. Oracle Cloud went live in Mexico and Google Cloud opened a cloud region in Paris, while AWS added another cloud on-ramp in Dublin, Ireland.
FedEx is the latest large enterprise to push forward and go basically all-in on cloud and has the potential to cannibalize some colocation demand in the process. Cloud cannibalization has been seen as a potential headwind that could slow demand for colocation, and in a similar way, hyperscalers self-building is seen as a possible threat to wholesale colocation demand. Hedge fund manager Jim Chanos made some noise about this as he looks to build a short position on the data centre industry. His take? Hyperscale clouds are going to turn around and compete head-on with data centre operators and cause significant pain. They are going to be more threats than customers over the long-term. We have had commentary on this in the past and will take a more detailed look in the coming weeks. Our quick take: shorting the data centre sector is an aggressive move that may not work out well given current sector dynamics.
Meanwhile, AWS CEO Adam Selipksy made interesting comments about cloud uptake in the enterprise space. His take is optimistic, but is it too optimistic? We offer our thoughts and analysis.
Finally, there has been some interesting reporting around capacity constraints at a number of Microsoft Azure data centres. The pressure on capacity speaks to where demand has been trending, but also reveals the many difficulties of operating in the current environment and the challenges of scaling at hyperscale levels.
The growth of the sector continues to garner attention and there is more debate than ever on the sector’s value proposition and future prospects.
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