M&A to Cause Huge Shifts in European Data Center Markets

Digital Marketing Agency, The appetite for colocation could create great divisions between industry leaders and smaller regional providers in Europe, with large players growing their market share, leaving the smaller players to focus on diversification to survive, analyst outfit 451 Research claims.

They are convinced that data regulation requirements, increasing demand for high-quality datacenter space, latency concerns, and a need to differentiate – with footprint, connectivity or services – will drive acquisition activity in this space in the near future.

 “Our analysis suggests that MTDC providers in Europe will become more cautious bringing supply to market – in some cases, these providers may choose to expand in partner colocation facilities where cloud or other nodes exist,” said Penny Jones, Senior Analyst – European Services, 451 Research.

She added: “We do not, however, expect to see huge revisions in build plans until 2016. Overall, the industry needs to be careful that such M&A activity – or expectations around it – does not lead to datacenter stocks becoming overvalued. A cautious approach will need to be taken to ensure key company stock is not put at risk.”