UK IT market growth: is data centre expansion the solution

It is no surprise that the UK has tough times ahead. However, data centre giants Equinix, Digital Realty and Next Generation Data have announced their plan to expand their data centre footprint in the UK. Why have they actively chosen to continue investing in the UK? Will this help the UK economy? What will this impact be post-Brexit? These are just a few of the questions I had upon reading this news.

The UK colocation market – a data centre facility in which a business can rent space for servers and other computing hardware – is growing. Multi-million pound expansions have been announced by these three giants.

Currently Equinix are building their existing presence in Slough. Plans reveal another £90m data centre during early 2019. This new facility will be said to provide thousands of businesses with access to the services of hundreds of network providers. Hyperscale cloud firms who rely on its interconnection platform will be able to distribute around the world.

This is all well and good, but what does this mean for the UK?

I’m sure we are all worried about the consequences of Brexit. The economy, single market and even maybe future holidays will be on your mind. Services are our main industry, but I never fully considered IT as the solution to these concerns.

Equinix claims that this investment has led to their £295m contribution to the UK digital economy in 2018/19. This was through their data centre expansion plans.

Russell Poole, UK Managing Director of Equinix mentioned that this investment should be considered indicative of its confidence that London will be able to stand the economic storm of Brexit. This is certainly one of the first bits good news that I have heard in terms of the economy.

“Our decision to invest again in the UK’s digital infrastructure reflects our confidence that London will remain a leader in the global digital economy, regardless of the outcome of the negotiations over the UK’s departure from the European Union,” Poole said.

“LD7 will be one of the most technologically advanced colocation data centres in the world and will be a major addition to our thriving London Slough campus. This latest data centre will also act as a sustainability benchmark for future data centres – something we are very passionate about.”

How does this compare to the rest of Europe?

CRBE published a report stating hyper-scalers are ramping up how much space they are willing to take within major European data centre hubs. This includes Frankfurt, Amsterdam, Paris and London. So what separates London and the UK from the rest of these data centres?

NGD – Europe’s biggest colocation campus – announced an additional £40m investment in its Cardiff-based data centre.

Justin Jenkins, managing director said expansion has helped the surrounding community with employment and outside investment.

“Over the years, NGD has successfully transformed the facility into Europe’s largest data centre which has attracted some of the world’s largest companies into the region,” said Jenkins.

“At the same time, we have provided direct employment as well as regular work for hundreds of contractors while also serving the IT needs of a growing number of fast growing local businesses.”

Correlation between data centre investment and the economy?

Digital Reality has built a data centre specifically to serve the needs of London businesses. This base is in Crawley.

Rob Coupland, managing director for Europe, Middle East and Africa said “We know from our recently published Data Economy Report that data centres deliver a significant boost to the economy,”

“This is why we’ll continue to power our customers’ digital ambitions through our investments so that we can help them put in place the digital foundations from which they can gain competitive edge, expand and grow their businesses.”

Final thoughts

“Society’s reliance on digital devices and cloud services, and consequent need for data storage and processing, will only increase as the world gets smarter and more connected.” said Mitul Patel, head of EMEA data centre research at CBRE.

So, will this help the UK post Brexit? It may not have all the answers but if we can continue investing in services and make Britain at the forefront of new technology, this can only aid the UK economy through this tough period.