London Multi-Tenant Datacenter and Hosting Market

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1 London Multi-Tenant Datacenter and Hosting Market The largest city in Western Europe, London is also the most diverse in terms of IT service providers. It offers an ideal base to provide colocation, hosting and cloud services to the rest of Europe, while providing a mix of customers. But the UK is a very competitive market, and as the price of floor space in London skyrockets, many service providers are being pushed to the periphery to run their operations. KEY FINDINGS The gentle return to economic growth in the UK has been reflected in the increasing level of demand for managed hosting services and datacenter space in London that is now outstripping supply for the first time since Consolidation continues to shape 451 Research s European Services: London Market Map TM particularly in the colocation segment, with a number of the top providers buying each other and creating even larger connected networks in the City and continental Europe. London multi-tenant datacenter (MTDC) providers continue to bring new space online at record levels, and we don t see this trend abating in coming years. We are seeing demand for services beyond straight wholesale or retail colocation, and partnerships are being created as a way to deliver on this demand. Small business growth in the service industry is creating increasing demand for more sophisticated, e-commerce based Web and application hosting in the SMB and midmarket sectors, fueled by the availability of 4G and lowcost data tariffs. International hosting firms continue to use London as their European base, expanding their presence via established networks of carrier-neutral hotels into the larger economies of Western Europe. A newly elected Conservative majority government has provided further impetus for business-friendly investment and tax breaks, as evidenced by the surge in shares and value of sterling on May 8, Government support for the Tech City startup scene in London has started to pay off both hosting and colocation firms say business is growing from an increasing number of new ventures born in Britain, many of which are starting small but aiming high. JUNE 2015

2 451 RESEARCH REPORT SNAPSHOT TITLE London Multi-Tenant Datacenter and Hosting Market ANALYST RELEASE DATE June 2015 LENGTH Rory Duncan, Research Director, European Services Penny Jones, Senior Research Analyst, European Services 34 pages ABOUT THIS REPORT London is the largest of the four key European metro markets London, Frankfurt, Paris and Amsterdam in terms of opportunity and geographic footprint for hosting and multi-tenant datacenter (MTDC) retail and wholesale colocation services. The demand for space and facilities has increased in recent years, and with it has come the opportunity and pressures to accommodate the need for additional space and services. The London Multi-Tenant Datacenter and Hosting Market report gives readers an overview of the trends that are shaping the MTDC market in and around London and service providers within it.

3 London Multi-Tenant Datacenter and Hosting Market TABLE OF CONTENTS SECTION 1: EXECUTIVE SUMMARY INTRODUCTION SECTION 2: THE LONDON MTDC AND HOSTING MARKET MULTI-TENANT DATACENTERS FIGURE 1: Datacenter Hubs in and around London MANAGED HOSTING & CLOUD HOSTING WEB & APPLICATION HOSTING SECTION 3: COMPETITIVE OVERVIEW MARKET MAP FIGURE 2: 451 Research European Services: London Market Map TM MARKET SHARE LEADERS AND EMERGING COMPETITION FIGURE 3: Top Providers in London MTDC Space (by Sq Ft) WHOLESALE DATACENTER SPACE 7 FIGURE 4: Top Wholesale Providers in London MTDC Space (by Sq Ft) FIGURE 5: Location of Notable Wholesale MTDC Providers for the London Market RETAIL MULTI-TENANT COLOCATION 10 FIGURE 6: Top Retail Providers in London MTDC Space (by Sq Ft) 10 FIGURE 7: Location of Notable Retail Colocation Providers for the London Market HOSTING 13 SECTION 4: MTDCS SUPPLY & DEMAND FIGURE 8: MTDC Supply/Demand and Utilization, London UTILIZATION PIPELINE FIGURE 9: Announced Pipeline London 19

4 451 RESEARCH SECTION 5: HOSTING SUPPLY DEMAND FIGURE 10: UK Hosting Market Size and Growth 22 SECTION 6: DISRUPTIVE TRENDS THE UK ECONOMIC OUTLOOK AND THE CITY OF LONDON M&A AND SERVICE CONSOLIDATION DATA PROTECTION & PRIVACY CONCERNS THE EFFECTS OF CLOUD HOSTING AND IAAS ECOSYSTEMS AND PARTNERSHIPS SECTION 7: IMPLICATIONS AND OUTLOOK IMPLICATIONS OUTLOOK APPENDIX I 31 METHODOLOGY TERMINOLOGY TAXONOMY MTDCS RETAIL COLOCATION WHOLESALE DATACENTER INTERCONNECTION MANAGED HOSTING INDEX OF COMPANIES 35

5 London Multi-Tenant Datacenter and Hosting Market ABOUT 451 RESEARCH 451 Research is a preeminent information technology research and advisory company. With a core focus on technology innovation and market disruption, we provide essential insight for leaders of the digital economy. More than 100 analysts and consultants deliver that insight via syndicated research, advisory services and live events to over 1,000 client organizations in North America, Europe and around the world. Founded in 2000 and headquartered in New York, 451 Research is a division of The 451 Group Research, LLC and/or its Affiliates. All Rights Reserved. Reproduction and distribution of this publication, in whole or in part, in any form without prior written permission is forbidden. The terms of use regarding distribution, both internally and externally, shall be governed by the terms laid out in your Service Agreement with 451 Research and/or its Affiliates. The information contained herein has been obtained from sources believed to be reliable. 451 Research disclaims all warranties as to the accuracy, completeness or adequacy of such information. Although 451 Research may discuss legal issues related to the information technology business, 451 Research does not provide legal advice or services and their research should not be construed or used as such. 451 Research shall have no liability for errors, omissions or inadequacies in the information contained herein or for interpretations thereof. The reader assumes sole responsibility for the selection of these materials to achieve its intended results. The opinions expressed herein are subject to change without notice. New York 20 West 37th Street, 6th Floor New York, NY Phone: Fax: San Francisco 140 Geary Street, 9th Floor San Francisco, CA Phone: Fax: London Paxton House (5th floor), 30 Artillery Lane London, E1 7LS, UK Phone: +44 (0) Fax: +44 (0) Boston 1 Liberty Square, 5th Floor Boston, MA Phone: Fax: