Digital transformation is causing data to explode worldwide, intensifying the need for connectivity. To compete, businesses need to address growing data volumes and data exchange points across multiple clouds and business ecosystems. In Europe, one of the world’s largest and most advanced economies, data is expected to grow to 3.7 million Petabytes by 2020 according to IDC. Amidst this data deluge, it’s no surprise that 80% of European CEOs say they are under pressure to execute a successful digital transformation strategy. In fact, European organizations are projected to spend over $271 billion on digital transformation in 2020.[i]
This is leading to growing demand for private interconnection in the region.[ii]The third annual Global Interconnection Index (GXI), a market study published by Equinix, predicts that private interconnection in Europecould reach 2,988 terabits per second (Tbps) by 2022, accounting for 22% of the global interconnection bandwidth growth.
A recent report by CBRE Research on the European data center market corroborates this trend.[iii] According to the report, 2019 will be the first year on record that the Frankfurt, London, Amsterdam and Paris (FLAP) markets are projected to finish at over 200 megawatts (MW) in take-up at a 23% annual growth rate. Nine deals, representing 60MW of additional capacity were expected to complete in 4Q19, and two-thirds of those deals (over 40MW) will consist of four hyperscale cloud deals. CBRE believes that cloud is driving both hyperscale and colocation activity in European markets and expects cloud to account for 80% of the demand by the end of 2019.
That’s why Equinix is deepening its commitment to the European market. In October 2019, we formed a $1 billion joint venture with GIC to develop and operate xScale™ data centers in Europe. This new offering will serve the unique core workload deployment needs of a targeted group of hyperscale companies, including the world’s largest cloud service providers. The facilities will allow these key enablers of digital transformation to streamline their continued growth, while strengthening Equinix’s leadership position in the cloud ecosystem. The initial six facilities in the joint venture will be located in the FLAP markets – Frankfurt (two sites), London (two sites), Amsterdam, and Paris – on some of Equinix’s existing International Business Exchange™ (IBX®) data center campuses. When fully built out, they will provide 155MW of power capacity.
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Data volume in Europe is expected to grow to 3.7 million Petabytes by 2020.
Here’s a closer look at xScale and Equinix in the FLAP markets:
Home to the European Central Bank, Frankfurt is one of Europe’s leading financial centers and a major hub for banking, commerce, global trading and manufacturing. Frankfurt has recorded twice as much take-up as any other European market and may surpass 80MW by the end of 2019. CBRE expects the city will account for 50% of the demand in 2019. This strong demand is also impacting Frankfurt’s vacancy rate, currently at 12%, the lowest in the market since 2013.iii
Our six Frankfurt IBX data centers offer 563,000 sq ft (57,100 sq meters) of colocation space. With 290 network service providers, 225+ cloud and IT service providers, 150+ financial services firms and 20+ trading venues, Equinix Frankfurt is one of Europe’s most interconnected hubs acting as a gateway between East and West.
The new xScale data center in Frankfurt, FR9x, will add 10 MW of capacity at the initial launch in late 2020. At full build out, it’s expected to support 18 MW of capacity.
Equinix Frankfurt FR2 IBX data center interior colocation space
London, United Kingdom
London has long been the heart of Europe’s financial center and, more recently, is on the fast track to becoming a FinTech hotspot. The city attracted over $2 billion in FinTech investment in 2019, placing it in the number two spot globally and number one spot within Europe for FinTech deals.[iv] Unsurprisingly, colocation demand is on the rise as well, and CBRE forecasts that there will be nearly 100MW of new supply added to the London market in Q419.iii
Equinix London consists of nine data centers (one xScale and eight IBX) with 757,000+ sq ft (70,250+ sq meters) of colocation space. Home to the London Internet Exchange (LINX) and London Network Access Point (LONAP), Equinix London also provides direct access to over 30 European markets and 80 exchanges. The London Equinix ecosystem includes 200+ network service providers, 285+ cloud and IT service providers, 320+ financial services firms and 95+ content and digital media companies.
The first xScale data center in London, LD13x, based in the existing Equinix LD10 IBX facility, will support 10 MW of capacity. The facility is now split between hyperscale deployments (LD13x) and existing retail colocation deployments (LD10). LD11x, the second xScale data center, will add 10 MW of capacity at the initial launch in early 2021. At full build out, it’s expected to support 19 MW of capacity.
Equinix London LD10 IBX data center (also home to the LD13x xScale data center)
With dense concentrations of network carriers and cloud and IT providers, Amsterdam has long been known as the digital gateway to Europe. The city contributed the largest portion of new supply in 3Q19 with a new 27MW data center according to CBRE.iii
Our nine Amsterdam IBX data centers offer 441,000+ sq ft (41,050+ sq meters) of colocation space. With low latency connectivity to a broad range of cloud and IT providers, Equinix Amsterdam also provides direct access to the Amsterdam Internet Exchange (AMS-IX) and the Neutral Internet Exchange (NL-ix), where approximately 1000 ISPs, telecommunications carriers, content providers and hosting services from all over the world connect. The Amsterdam Equinix ecosystem includes 190+ network service providers, 425+ cloud and IT service providers, 70+ financial services firms and 105+ content and digital media companies. In addition to this rich ecosystem, our Amsterdam IBX data centers use award winning sustainable technologies to save energy and advance responsible water consumption, including aquifer thermal energy storage (ATES), free air cooling, green rooftops and renewable power. In fact, 95% of our EMEA data centers and nearly 100% of our FLAP data centers are covered by renewable energy now.
Equinix Amsterdam AM3 IBX data center
As one of Europe’s largest consumer markets, Paris is also a strategic hub for the exchange of traffic between the U.S. and Europe and termination point for subsea cables from Africa, the Middle East and Asia Pacific, connecting these markets with Europe. Surprisingly, despite a low vacancy rate of 14% in 3Q19 and interest from developer-operators searching for new colocation sites, CBRE recorded less than 1MW of take-up in the market during Q319 and little new supply.iii
Equinix Paris consists of eight fiber-connected data centers (one xScale and seven IBX) with approximately 502,000 sq ft (46,700+ sq meters) of colocation space. The Equinix Paris ecosystem also includes 100+ network service providers, 230+ cloud and IT service providers, 50+ financial services firms and 60+ content and digital media companies.
The former Equinix PA8 IBX in Paris is now the PA8x xScale data center. The first phase of the facility opened in Q1 2019. At full buildout, PA8x is expected to support 14 MW of capacity.
Equinix Paris PA6 IBX data center
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[ii] Interconnection bandwidth is defined as the total capacity provisioned to privately and directly exchange traffic, with a diverse set of partners and providers, at distributed IT exchange points inside carrier-neutral colocation data centers.