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The Line Between Wholesale And Retail Colocation Is Blurring

The Line Between Wholesale and Retail Colocation is Blurring

Wholesale and retail colocation are merging, since a few years actually. Wholesale data center colocation players are coming down as far as 100 to 250kW (which used to be about 1MW to make economic sense) while adding an increasing number of managed services. Retail colocation companies on the other hand, with managed services as an integral part of their portfolios for a while already, tend to increasingly sign up data center customers into the multi-megawatt range. In this article we will share the implications it may have for you when selecting your colocation provider.

The traditional wholesale data center operators have their origins in the real estate business. They’re not so much service providers, but they know how to offer cost-efficient buildings. While they’re used to keeping the managed services to a minimum, they can be a good match for enterprises, hyperscalers, and other companies with large-scale applications seeking low-cost housing for their IT-infrastructures.

Retail colocation providers have been delivering their data center services from a service provider model. You can get all sorts of extra services on top of the colocation space you agree on, such as remote hands engineering services, interconnectivity or cloud onramps, to name a few. Some wholesale data center providers now tend to add managed services, although their origins are not in the service provider model. Retail colocation providers on the other hand, including maincubes, are increasingly embracing the wholesale model as an added service to their colocation offerings.

From a colocation customer perspective, it’s good to know that both wholesale and retail colocation providers can be targeting similar customers these days. Even though the services being offered look the same, they might differ in terms of client experience due to the wholesale or retail background of a data center operator.

Energy efficiency and (inter)-connectivity

In our opinion, colocation wholesale offerings deriving from retail colocation providers can best provide for the added value currently requested by many enterprises, cloud service providers (CSPs) and others seeking large-scale data center deployment opportunities. The traditional wholesale segment used to put less value on network connectivity and remote hands support for example. That’s how they managed to keep their cost levels as low as possible in the old days. Current situation within the data center environment is more complex than ever, with cost efficiencies mainly achieved through smart, energy-efficient cooling and power infrastructure setups. Next to that, connectivity, interconnectivity and flexibility in connectivity options have by now become a prerequisite for deploying efficient large-scale data center infrastructures, for CSPs as well as enterprises.

Leaseweb, a global market leader in the field of cloud hosting services selected the maincubes Amsterdam AMS01 data center as a strategic location for further expansion of its data center presence in Amsterdam last year. It’s a good example of a large-scale cloud hosting services provider seeking wholesale colocation space with a retail data center operator. Our AMS01 data center in Amsterdam meets Leaseweb’s expectations in terms of energy efficiency, compliance and high redundancy. It also offers them extensive growth options for scaling up Leaseweb’s server and network infrastructure in Amsterdam.

In a joint message about the partnership, Leaseweb stated that they appreciate maincubes’ entrepreneurial spirit as a provider of wholesale data center space. It turns out to be a good match with Leaseweb’s own entrepreneurial company culture. We are very well able to flexibly adapt our retail data center operations to such wholesale customer needs. Obviously, wholesale colocation clients like Leaseweb can appreciate this flexible approach which comes with lots of autonomy and scalability in terms of power, cooling, and floor space.

Added value: OCP, immersion cooling options

Cost reduction has been an important argument for choosing wholesale colocation. Previously, now and probably also in the future. On the other hand, given the fact that enterprises and CSPs are facing added complexities nowadays when deploying data center infrastructure, ease of deployment obviously plays a role as well currently. We see enhanced interest for large wholesale suites in retail data center facilities, to create data center in data center concepts within an environment backed by the highest managed services levels.

In the case of maincubes, as a colocation provider, we even go one or two steps further by creating an ecosystem of companies and technologies that breathes innovation. In which customers can thrive, also our wholesale customers. A few examples? Operated by data center vendor Rittal and Europe’s first official OCP Solution Provider, Circle B (part of Taurus), maincubes AMS01 offers access to the European OCP (Open Compute Project) Experience Center. Here, clients can test new ‘OCP Accepted’ and ‘OCP Inspired’ data center environments and telecom solutions. In addition, also in AMS01, we offer immersion (liquid) cooling solutions in dedicated immersion cooling colocation suites. It enables the deployment of applications related to HPC, AI and machine learning workloads.

Another wholesale data center client in Amsterdam AMS01, 3W Infra, truly welcomes these value adding services available in their data center facility. “As IaaS hosting provider we certainly appreciate these extras in the data center,” said 3W Infra CEO and founder Murat Bayhan in this joint message we released before the summer. “maincubes doesn’t just provide colocation services. They offer us a very innovative and absolutely unique data center environment, I have to say. I’ve never seen a colocation provider that offers so many extras under one roof, with several sustainable and state-of-the-art technological solutions to choose from and use.”

Of course, as a wholesale data center client, you first want the basics that are delivered to be perfect. The global and regional connectivity options as well as its security must be great. Cloud connects must be present. High power and cooling redundancy as well as high densities might play also a role in wholesale customer demand. And not to forget about the compliance. Unlike in the old days, a wholesale data center operator must preferably be accredited according to a wide range of industry certifications.

To conclude, we would like to bring in a comparison with a vehicle that’s being considered an icon in the automotive industry, the Land Rover Defender. After being launched three decades ago, this model finally received a complete redesign recently, with many new features and lots of comfort being added. We also think a new era in the data center industry has begun in which even wholesale clients are entitled to extra benefits and entitlements.

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