The Strategic Advantages of Network-Centric Colocation
AUTHOR: Bob DeSantis, CEO, 365 Data Centers
Colocation has been an important element of the data center industry since the inception of the internet. In fact, early on, colocation was commonly described as being available at “internet data center facilities.” However, not all colocation is created equal. Network-centric colocation is a strategic approach to data center infrastructure investment that prioritizes both connectivity and interconnectivity. It is important for data center customers to understand how a data center operator is positioned to provide interconnectivity within and between its data centers and other connectivity options outside of the data center. The more network-centric the data center operator the more harmonious and streamlined the colocation and connectivity solution will be. 365 Data Centers is proving out the model for how network-centric colocation can be successful and provide the service provider and its customers with strategic advantages.
Unlike traditional colocation, where the focus is primarily on physical space and power, network-centric colocation places equal emphasis on creating a network ecosystem within the data center facility. This approach enables customers to leverage the benefits of a carrier-neutral interconnection platform, allowing seamless interconnection to a significant number of international, national, regional, and local carriers. 365’s colocation customers include about 110 such carriers that maintain approximately 275 Points-of Presence (“PoPs”) within 365’s 20 data center facilities. As the facilities operator, 365 can arrange instantaneous interconnection to all of these carriers via cross connects. In addition to carrier interconnection within a network-centric facility, each of 365’s data centers are redundantly interconnected to each other to enable 365 multi-site customers to transport its data efficiently and cost effectively between their production and back-up colocation deployments. Strategically, 365 partners with its carrier colocation customers to secure the transport circuit element. An important distinction related to 365’s network-centric colocation model is that the network equipment element of the network ecosystem is owned, operated, and maintained by 365, not the carriers that provide the transport circuits. As such, in this network-centric colocation model, the data center operator controls and manages the speeds and feeds of the interconnection.
By co-locating in a network-centric data center, customers gain the ability to interconnect with any carrier, business partner, or data center within the colocation operator’s network ecosystem, regardless of the geographic location of the interconnected facility. Network-centric colocation facilities provide customers with interdependent routing capabilities, traffic engineering, and a backbone of networks that constitute “digital bunkers” during manmade or natural disasters. 365 consistently makes major investments in the network equipment and circuit elements providing interconnectivity. As a result, the company’s data center facilities serve as important regional network hubs and is one of the nation’s densest network centric-data center operators. This positioning provides customers the strategic advantages of network access flexibility, bandwidth scalability, and redundancy, which ensures optimal performance by mitigating risks associated with service disruptions.
The second pillar of network-centric colocation is the provider’s ability to connect outward through a nationwide fiber network with initiation and end points managed by the operator’s owned network equipment infrastructure. In addition to its 20 redundantly interconnected data centers, 365 maintains 125 additional network PoPs throughout the US that house the Company’s state-of-the-art network servers and routers which are also interconnected with each of its data centers. This model not only allows for interconnectivity within the data center ecosystem but also for customer connectivity solutions to and between each of the combined 145 PoPs within and beyond the 20 data centers.
Another critical aspect of the 365 network-centric model includes a robust internet access capability. Unlike non or lesser network-centric business models, 365’s model includes registered ownership of a substantial number of IP addresses and more than 700 peering partners. The combination of in-place nationwide PoPs for data transport connectivity, and substantial IP address ownership coupled with significant peering partner connections to deliver the lowest cost internet connectivity, provides a full spectrum connectivity value proposition that further solidifies the strategic operating and cost advantage to both customers and the network-centric colocation provider.
Cloud services are also an important component of connectivity. Network-centric data centers, like 365, are designed to best serve a customer’s hybrid cloud requirements by providing several public cloud direct connectivity options. Customers are empowered to connect steady workloads that run in either the data center operator’s colocation or cloud instance with peak and valley workloads that are run in a public cloud environment. This combination best enables and supports the customer’s public cloud initiatives.
With the demands of AI technology for colocation space and power already on the horizon, colocation providers that are also network-centric and equipped to provide all of the interconnectivity and connectivity solutions described above and their customers will have a strategic competitive advantage. This is because the explosion of AI data which will be stored at colocation facilities will, to a great extent, also need to be transported. Colocation operators that are truly network-centric and their customers are best prepared to both store and transport the anticipated increases in data volume in the most flexible and cost-efficient manner. In addition, a significant portion of AI data will need to be stored close to where it is created and used. This also provides network-centric colocation service providers located in “edge” second tier markets and their customers a strategic advantage.
365 Data Centers has spent over six years honing its network-centric colocation business and leading the way in delivering network-centric solutions. We have first-hand knowledge of what it looks like and how to define it. We trust this overview provides a front row seat to the operator and customer strategic advantages of network-centric colocation.
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