Verizon Communications Inc. has wanted to cut back on its physical data center business. Equinix wants to green-light its data center expansion, so they’ve closed a deal.
Verizon announced back on Dec. 7 that it had agreed to sell 24 data center sites to Redwood City, Calif.-based Equinix in a transaction valued at $3.6 billion in cash. On May 1, the deal was consummated, a month or so earlier than expected.
Equinix now will own and manage 24 former Verizon customer-facing data sites, consisting of 29 data center buildings, in the United States and Latin America. The transaction includes more than 1,000 customers, of which over 600 are net new for Equinix, and about 3 million square feet of data center space, the company said.
The acquisition of these strategic facilities broadens Equinix's capabilities by strengthening interconnection density on the Equinix global platform; accelerating business relationships in the government and energy sectors; and supporting Equinix's enterprise offering.
Three New Markets for Equinix
It adds three new markets (Bogotá, Culpeper, Va., and Houston) and provides additional capacity and the opportunity for expansion in markets where Equinix currently has a presence, including Atlanta, Denver, Miami, New York, São Paulo, Seattle and Silicon Valley.
Spread across 15 cities in North and Latin America, the new assets bring Equinix's total global footprint to more than 175 International Business Exchange (IBX) data centers across 44 markets and approximately 17 million square feet. That’s a lot of real estate.
The transaction aligns with Verizon's strategy to focus on driving digital transformation for enterprise customers, not running data centers.
The sale does not affect Verizon's managed hosting and cloud offerings, or its data center services delivered from 27 sites in Europe, Asia-Pacific and Canada.
Included in the deal for Equinix is Verizon's Miami Network Access Point (NAP), also called the NAP of the Americas. NOTA is a pivotal transit location for data between the U.S and Latin America, in addition to being an interconnection point for about 90 global networks.
First Entrée into South America
“Bogotá is our first entrée into what we call the northern half of South America, and Colombia is a really good high-density terminating point for cable landing and traffic in and out of the continent,” Equinix President of the Americas Karl Strohmeyer, who oversaw the acquisition, told eWEEK. “Culpeper (Va.) is predominately centered around the government; there are four data centers on that campus. We [already] have a good government business ourselves, but when we add what Verizon brings to the table, it’s a pretty exciting accelerant into what arguably is the largest enterprise sector in North America.
“We’ve been trying to get into Houston forever. Finally, through this acquisition, we get a really nice data center that gives us a foothold into the fourth-largest enterprise market in North America, and, of course, is a really good center for oil and gas.”
In other Equinix news, the company revealed last week that Discovery Communications is implementing a new Interconnection Oriented Architecture that will enable the company to update its digital business to a fully cloud-based, distributed model.
By co-locating the company's IT infrastructure in Equinix International Business Exchange (IBX) data centers in Ashburn, Va., London and Paris, Discovery will consolidate 80 percent of its IT infrastructure, optimize delivery of worldwide content and accelerate real-time product delivery via fast low-latency connections.
Discovery Communications, best known for the Discovery Channel cable network, reaches more than 3 billion cumulative viewers across pay-TV and free-to-air platforms in more than 220 countries and territories. Discovery was looking to accelerate its real-time product delivery to meet rising end-user consumption demand and to integrate IT infrastructure from Eurosport, the leading provider of locally relevant, premium sports and Home of the Olympic Games across Europe, Equinix said.
Eighty Percent of Discovery's IT Now at Equinix
The deployment process includes consolidation of 80 percent of Discovery's back-office support systems, applications and network connectivity, and it provides access to Equinix Media Cloud Ecosystem for Entertainment, which supplies a gateway to media services in the public cloud.
Using an IOA on Platform Equinix, Discovery gained a localized delivery of cloud-supported services with secure, direct connections to effectively reduce cost. Developed by Equinix, IOA is a proven and repeatable engagement model that shifts the fundamental IT delivery architecture from siloed and centralized to interconnected and distributed.
Equinix's global interconnection platform provides media and entertainment companies with solutions that include Equinix Cloud Exchange, which provides direct access to major cloud service providers including AWS, Google Cloud Platform, IBM Softlayer and Microsoft Azure and Office 365.
"The cloud is the future for digital media and entertainment--the agility and cost advantages are immense,” said David Duvall, Senior Vice President of Infrastructure and Support Services at Discovery Communications. “Once we started, it was quickly apparent that we needed a neutral interconnect partner who would enable us to connect our entire ecosystem physically and virtually, allowing us to scale up or down to address current and future requirements.
“Equinix has been key to Discovery's success with this digital transformation, and we look forward to expanding our network with Equinix as we grow our global business.”