Switch pays $420mn for Data Foundry, launches “Fifth Prime”
Nevada-based, exa-scale data centre operator, Switch, has plans to significantly expand its presence in the southern and central US. On Monday, the firm revealed that it has reached an agreement to acquire Texas-based data centre operator Data Foundry in a $420mn all-cash transaction.
Switch Founder and CEO Rob Roy said that he was “extremely pleased” to have reached an agreement with Data Foundry, adding that the “acquisition extends Switch’s national reach and enhances our ability to serve Texas and the Central US region with low latency connectivity, while also providing critical geographic and revenue diversification with robust expansion potential to accelerate long-term growth and value creation.”
Courtesy of Switch
Data Foundry’s portfolio consists of four multi-tenant data centres - three in Austin (with the potential to expand to 44 MW of total capacity) and one in Houston.
The addition of these facilities brings Switch’s total footprint to 16 data centres spread across six US locations, including the company’s four pre-existing Prime regions and now its fifth Prime located in Texas.
Switch - largely thanks to the influence of its CEO, Rob Roy - has a unique approach to offering data centre solutions. The company focuses entirely on the US market and currently operates some of the , including the campus in Tahoe Reno, Nevada (as well as its other “exa-scale” campuses, , the Core in Las Vegas, and The Keep in Atlanta, which conspire to divide the US into different latency zones).
Thomas Morton, President of Switch, cited Data Foundry and Switch’s shared focus on high-quality data centres and innovative approaches to engineering attracted the company to move forward with the acquisition.
“These data centres are really, really high-quality assets,” said Morton to Data Center Frontier. “They’re very high-design, and there will be no need for us to retrofit (to have consistent standards).”
“Data Foundry is proud to partner with Rob Roy and the Switch team in this transaction that we believe will carry forward our company’s rich history of innovation in Texas, and will result in tremendous long-term benefits to our customers and all stakeholders of the combined business,” said Carolyn and Ron Yokubaitis, Co-Founders of Data Foundry.
The transaction is expected to close some time before the middle of the year, and remains subject to regulatory approval.
Equinix: Digital leaders expect changes to working patterns
A global report released by Equinix has revealed that digital leaders expect long-term changes to the way people work.
As part of the report, the data infrastructure company surveyed 2,600 IT decision-makers from several different businesses spanning 26 countries in the Americas, Asia-Pacific and EMEA regions. The study also highlighted the biggest technology trends affecting global businesses and how the COVID-19 pandemic has impacted digital infrastructure plans.
Talking about companies’ expansion strategies, Claire Macland, Senior Vice President of Global Marketing at Equinix, said: “Many companies are now investing more in their digital infrastructure to enable them to embrace a hybrid working model and thrive in the new world of work we all find ourselves in.
“Despite headwinds in many sectors, many organizations are continuing to expand physically and virtually into new markets and regions around the world”, she said.
The report drew the following conclusions:
- 64% of the 2,600 digital leaders surveyed believed there will be “long-term changes to both how and where people will work in the future.
- 57% of global companies intend to expand into new regions despite the effects of the pandemic
- 51% of businesses worldwide say they have rearchitected their IT infrastructure so that it can meet the demands of remote and hybrid working. Digital transformation has also been accelerated due to an increase in businesses’ technology budgets.
How might digital transformation be affected post-pandemic?
COVID-19 has demanded that companies make several changes to the way that they operate, including digital transformation. According to the study, 47% of those surveyed reported that they have accelerated their digital transformation plans because of the Coronavirus pandemic. A further 42% of organisations said their budgets have increased to keep up with the growth of digital transformation.
Another change in adapting to the pandemic was to businesses’ IT strategies with six in 10 companies saying that it has been revised in response to the situation. 58% said they are looking to invest in technology to “improve agility’ post-COVID.
When asked about their priorities for their digital strategy, 80% of respondents said that digitising their infrastructure was of utmost importance, while 57% viewed interconnection as a ‘key facilitator’ of digital transformation.
"This increasing focus on digitization and expansion is one of the reasons why Equinix has continued to invest in its own growth. We completed 16 new expansions in 2020—our most active build year ever—and expect to continue to evolve Platform Equinix to support our customers as they continue on their digital transformation journey”, said Claire Macland.
Potential concerns disperse over expansion plans being halted by COVID-19
The study has also revealed that organisations’ previous concerns that the pandemic will negatively affect their business expansion plans have been lessened.
57% of businesses have said that they “still have plans” to expand into new regions and of that percentage, nearly two-thirds (63%) plan to do so virtually instead of investing in physical IT infrastructure.
The full Equinix report can be found here.