The New Telco Data Centre - Pricing for the New Telecoms Data Centre 2014 to 2019

TCL sets the scene for the key drivers responsible for the growth in New Telecoms Data Centre facilities worldwide. 

By using the term The New Telco Data Centre TCL is highlighting the emergence of new high specification Telco Data Centre space which can be used to house equipment, provide network or colocation connectivity but can also offer managed hosting services, cloud services and on demand application and IT services.

The New Telecoms Data Centre is being asked to cater for a series of needs, power and to provide a high degree of redundancy to support the entry of the telecoms provider into the provision of cloud and applications management for its enterprise customers.

The New Telco Data Centre is able to cater for a wide range of services, which distinguishes it from previous Telco Data Centres, which were built to cater for a relatively narrow range of services such as colocation, equipment housing and connectivity and had a lower specification.  

In this section TCL provides a definition of the New Telco Data Centre and analyses the landscape, the main drivers, trends and the key services that are being provided from the facilities. 
TCL also examines the types of New Telco Data Centre that are emerging and the changes in the provision of the facility and the service mix being offered. 

Finally, TCL also consider the business models that are being created to support the emergence of the New Telco Data Centre. 

A number of Telecoms Providers are using their New Data Centre facilities to focus on four particular customer segments including the following types of facility - 
 
1. Tele housing Data Centre facilities - Which are used to provide telecoms equipment housing & connectivity, typically for wholesale telecoms providers and also the Telecoms Provider's own network equipment. 

2. Colocation Data Centre facilities - Which are used to provide IP connectivity & housing services.

3. Networked IT services facilities - Which are used to provide IP connectivity, network services with selective enterprise IT outsourcing, with dedicated facilities offered for enterprises.

4. Hosting & Cloud facilities - Which are used to provide virtualised service platforms from the Telecoms Data Centre for private, public & hybrid cloud computing services offered to the enterprise, together with dedicated or shared hosting services.
A definition of the New Telco Data Centre 

TCL provides a definition of the New Telco Data Centre used for the purposes of this report below:

"The New Telco Data Centre is defined as being a facility that can provide multiple services and uses with different grades of service and power. Multiple halls - or modular zones - are being constructed to cater for the provision of network equipment, hosting, colocation & housing and managed services. The Data Centre can cater for both the Telco's own services and third party enterprise users. And for enterprise users different grades of power and SLA can be provided to meet different price points or requirements". 

The New Telco Data Centre typically varies from previous Telco facilities by offering a fuller range of services - as a flexible Data Centre facility. 

With multiple data halls the new Data Centre facilities has the advantage of offering separate grades of service or zones, which can be dedicated for a specific customer, product offering a specific tier of service.

The Telecoms Provider by using the New Telco Data Centre is becoming a flexible Data Centre provider - which can cater for a wider range of customer requirements from the one facility.

The business landscape for the New Telco Data Centre 

The New Telco Data Centre operates in a business landscape where it is one of a number of Data Centre players, which are currently available in the Data Centre market in each country. 

TCL has identified five separate Data Centre player types that are available which are summarized below: 

1. The Carrier Neutral Data Centre specialist - With facilities being provided to offer retail Data Centre space with multiple telecoms and IP networks present, with Data Centre providers such as Equinix & Interxion.  

2. The Wholesale Data Centre - With facilities being provided to cater for large space requirements, with Data Centre providers such as Global Switch & e-Shelter.  

3. The Hosting Data Centre - With facilities being provided to support hosting services, with hosting providers building their own facilities, with Hosting providers such as OVH constructing their own Data Centres, which are also being used for colocation and cloud computing services. 

4. The Premium Data Centre - With new facilities being constructed for high density IT applications, capable of catering for power of up to 20kW per rack, with examples such as TelecityGroup (TelecityGroup Powergate in West London).
5. The IT services Data Centre - With facilities being provided to support outsourcing clients, with HP, EDS and BT Global Services and T-Systems also using Data Centres for outsourcing.  

The other types of Data Centre business models that are typically available in the market are shown in the table below: 

Figure 2 - A table showing the different Data Centre business models that are available
Data Centre Business Model Type Description
Carrier Neutral Data Centre Specialist provider of space & power offered to enterprises & a range of service providers - e.g. Equinix.
IT Services Data Centre Provider of space to support IT outsourcing, integrators and IT applications - e.g. IBM.
Hosting Services Data Centre Provider of space to support hosting providers, including cloud services - e.g. OVH 
Wholesale Data Centre Provider of large-scale space, typically sold by the suite or floor with bespoke fit outs - e.g. Global Switch.
Colocation Data Centre  Provider of housing & colocation with low power densities with telehousing - e.g. Citylifeline.
New Telco Data Centre  Provider of Flexible Data Centre space, suitable for a range of densities & applications - e.g. PT Prime (Portugal).
Source - TCL 

In many established Data Centre markets, such as Europe & the USA, it is the Carrier Neutral Data Centre specialist that is growing the fastest, as selected Telecoms Providers rent specialist third party Data Centre space rather than build their own new dedicated facilities. 

The decision to build a new Data Centre facility is a strategic one for the Telecoms Provider. The high cost of build out means that new facilities are limited to the large telecoms incumbent operator who has the financial ability to make the significant investment required. 

The decision to build the New Telco Data Centre is also strategic, as the Telecoms Provider is using the facility as a visible sign of its intention to provide Cloud, Hosting and Managed Services to a large enterprise customer.