This page contains a Flash digital edition of a book.

Issue 15, April/May

Telx, 60 Hudson Street New York

To win the market players must have a lot more than cheap power and high reliability, as Yevgeniy Sverdlik discovers


arge colocation companies have made it clear they view the cloud market as a huge growth opportunity and are establishing dedicated sales resources focused exclusively on it. “We actually have a sales team that is focused on the whole stack of cloud providers,” says Telx CEO Eric Shepcaro. The company sees demand from Software-as-a-Service (SaaS), Infrastructure-as-a-Service (IaaS) and Platform-as-a-Service (PaaS) players, as well as growing demand from enterprises looking to deploy private cloud environments in its data centers in the US.

Telx considers SaaS to be the biggest of all flavors of cloud. In the Atlanta market alone, for example, Telx found more than 70 SaaS providers, offering everything from human resources and customer relations management applications, to applications for financial services companies. The story is similar for Equinix, which says cloud computing has become one of the key market verticals the company defines in its strategy. The other verticals are network, financial, enterprise, content and digital media. Cloud and enterprise were added recently.

Equinix today has more than 200 customers defined as providers of cloud services. The company also has more than 300 managed services providers and system integrators, most of which have cloud strategies.

Vincent DiMemmo, general manager for

Equinix’s cloud vertical, says revenue from the market in 2010 was more than 20% of Equinix’s


The primary challenge for cloud providers lies in the delivery of service. Providers are going after customers that have the same applications hosted on premise, right next to the end users. This way they can ensure the same or better levels of service and lower cost for customers.

Colocation companies must help cloud providers address this. Equinix, for example, helps the providers architect their infrastructure within its data center footprint to be in close proximity to users. It traditionally focused on creating a rich interconnected network ecosystem within its data centers, which today has become an important advantage in selling into the cloud provider market.

Telx has historically emphasized network diversity in its business model. Its offering is also strong in terms of location because it generally builds data centers in major urban areas. Telx has data centers in all major metro areas in the US and has partnered with India’s Tata for international reach, which gives its customers access to facilities in Canada, Europe, Africa and Asia.

Cloud providers also expect their data center suppliers to have robust optimization tools. Shepcaro says that cloud companies require high visibility into Layer 2 and Layer 3 networks – they want to know exactly how much bandwidth applications are consuming

total revenue for the year. “Last year it grew more than 36% year over year,” he says. “It’s carrying its share as one of the five verticals.”

and what latency exists between locations. Because Telx has placed so much focus on catering to the financial services market, it has developed advanced capabilities to offer network visibility to financial clients – these require the same level of visibility as those offering services in the cloud.

There is also a need for solutions integrated across multiple types of infrastructure. Paul Carmody, VP of product management and business development at Internap, says cloud providers tend to want flexibility to mix and match different infrastructure assets. In addition to being able to integrate multiple physical and cloud-based assets, Internap has some proprietary technology it considers an advantage in the cloud market. The technology is for Internet-routing optimization. It searches for the best path across multiple networks and also uses acceleration technology to further decrease latency.


John Keagy, CEO of IaaS player GoGrid, says brand name, customer ecosystem, vendor ecosystem, location and price make cloud a successful sell – in that order. Price is low on the list because of the high “revenue density” per rack that cloud providers are able



HP sees cloud computing as the next evolution of the Internet – the

manifestation of “everything-as-a-service” in a service-oriented world. Cloud computing has been the cause of rapidly increased innovation within the hosting industry. Providing Infrastructure-as-a-Service through the cloud creates more use cases for outsourcing IT services, and more benefits

Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48  |  Page 49  |  Page 50  |  Page 51  |  Page 52  |  Page 53  |  Page 54  |  Page 55  |  Page 56  |  Page 57  |  Page 58  |  Page 59  |  Page 60  |  Page 61  |  Page 62  |  Page 63  |  Page 64