In 2020, digital transformation suddenly turned into an urgent mandate. Even digitally transformed businesses had to rework their infrastructure for secure remote working and wider outreach to customers.
For some, this also included enhancing their operational workflows as well as internal processes and data-driven strategies. All of these efforts are crucial to keeping up with turbulent global changes.
All these lifelines for business survival can put a heavy burden on the existing IT infrastructure. It raises concerns over whether there is sufficient capacity, scalability and redundancy for business continuity. Should the system ever fail or be the subject of unplanned outage or cybersecurity lapses, the consequences may mean permanent closure.
Colocation has been a natural pathway for all kinds of organisations, including enterprises and many digital providers, to deliver services at scale and with redundancy. Organisations are choosing colocation because it delivers affordability, reliability and scalability.
However, not all colocation providers are the same. Organisations need to take a dynamic approach to colocation, with a provider than can deliver hyper-connected digital hubs for long-term growth.
Worldwide colocation trends
Colocation and interconnection services are defined as the business case of using a third party's data centre facilities. This includes physical floor/cage/rack space, network capacity, and HVAC/power infrastructure. Customers operate their own servers/storage systems, network equipment, and other devices. The global data centre colocation market size is expected to reach $104.77 billion by 2027, expanding at a CAGR of 12.9% from 2020 to 2027, according to Grand View Research.
In an IDC study on colocation trends in North America, Europe and the Asia-Pacific region between 2019 and 2020, the migration to digital platforms, as well as the requirement for seamless and efficient interconnection to network providers and cloud platforms, is a strong driver for the colocation and interconnection market for enterprises, content, and service providers.
Colocation facilities that offer additional enhanced and diverse options for service providers and enterprises alike, will continue to drive growth of the digital ecosystem.
Finetuning your colocation strategy with interconnection
With recent market intelligence in mind, businesses have to select colocation providers with a solid long-term vision for interconnection.
Traditional colocation services, both retail and wholesale, are focused on selling racks and space. It is so commoditised that an enterprise may decide on a provider based on cost and onsite features alone. That is the easy part. What customers need to understand is that their colocation solution must be ready to interconnect with a broader ecosystem.
They need to select a partner that can remove the complexity and reduce cost associated with owned infrastructure or managing multiple service providers. The right provider will offer a comprehensive solution for transformation.
Some important aspects to consider include the location of the colocation data centre facilities. These should be strategically located as close to end users as possible and with high interconnection density of network service providers.
On top of this, the provider should offer more than basic colocation services. It should be able to deliver a suite of network solutions, as well as physical and digital security with redundant power supplies, multi-layered security, climate-controlled environments and robust Service Level Agreements (SLAs).
An interconnect ecosystem is also vital. A highly connected environment can enable the organisation to rapidly connect to other data centres, public clouds and internet exchange points. With hybrid cloud being the preferred cloud environment, an organisation should also be able to benefit from secure and reliable cloud on-ramps from the colocation facility.
Colocation services, as well as the associated network connectivity, should offer scalable and flexible options for tenants as they grow. Otherwise, an organisation may be stuck in a long-term contract with over-provisioned infrastructure and high operating cost.
Lastly, the colocation provider must continually add more service capabilities and connectivity solutions while optimising its facilities to new standards.
A solution for the future
In a world that can change overnight, organisations need a simple and flexible solution for deploying, connecting and managing applications and services. Uncertainty drives the need for greater scalability in digital infrastructure and models to match the needs of transforming ICT environments.
Organisations need dynamic colocation services that are fluid, flexible and hyper-connected. They need the ability to scale-up rapidly in new markets while pivoting to deliver new solutions in others. Agility needs to be built into all aspects of their ICT, including colocation.
Colocation can provide the starting point for growing in a new market or optimising digital infrastructure in an existing market. The key is to explore colocation options and ensure that the services available match an organisation’s growth ambitions and ICT roadmap.
