26% of revenues come from the world’s top five metro areas alone.
Data centres are being built all over the world, however, 59% of global revenues from wholesale and retail colocation come from just 20 metro areas in North America, Europe and APAC.
According to Synergy Research Group, of those 59%, 26% come from the world’s top five metro areas alone including Washington, New York, Tokyo, London, and Shanghai. The think tank ranked the cities by revenue generated in Q3 2017.
The next 15 largest metro markets account for another third of the worldwide market. Those top 20 metros include ten in North America, four in the EMEA region and six in the APAC region.
Across the 20 largest metros, retail colocation accounted for 72% of Q3 revenues and wholesale 28%.
In Q3 Equinix was the market leader by revenue in eight of the top 20 metros and Digital Realty would be the leader in five more if a full quarter of the acquired DuPont Fabros operations were included in its numbers.
Other colocation operators that featured heavily in the top 20 metros include 21Vianet, @Tokyo, China Telecom, CoreSite, CyrusOne, Global Switch, Interxion, KDDI, NTT, SingTel and QTS.
Over the last four quarters, colocation revenue growth in the top five metros outstripped growth in the rest of the world by two percentage points, which according to Synergy, translates into the worldwide market being slowly concentrated more in those metro areas.
The Top 20 metros with annualised growth rates of 15% or more (measured in local currencies) were Shanghai, Beijing, Hong Kong and Washington/Northern Virginia.
All four saw strong growth in both the retail and wholesale segments of the market, though growth in wholesale tended to be higher. Synergy also highlighted Chicago, which has seen very strong growth in wholesale revenues, though in this metro retail colocation growth was relatively weak.
John Dinsdale, a Chief Analyst and Research Director at Synergy Research Group, said: “While we are seeing reasonably robust growth across all major metros and market segments, one number that jumps out is the wholesale growth rate in the Washington/Northern Virginia metro area.
“It is by far the largest wholesale market in the world and for it to be growing at 20% is particularly noteworthy. The broader picture is that data centre outsourcing and cloud services continue to drive the colocation market, and the geographic distribution of the world’s corporations is focusing the colocation market on a small number of major metro areas.”