11-11-2015, 17:00 #1
[EN] Zayo Buys Viatel, Gains Data Centers, Network Assets in Europeby Yevgeniy Sverdlik on November 11, 2015
Zayo Group has agreed to acquire seven data centers and pan-European network assets of the Dublin, Ireland-based service provider Viatel, subsidiary of the Digiweb Group, for €95 million. Only Viatel’s assets outside of Ireland are part of the deal.
The acquisition will add about 5,200 miles of fiber across eight countries, including 12 metro networks and connectivity to 80 buildings to Zayo’s portfolio. It also gains submarine cable systems between London and Amsterdam and between London and Paris.
Zayo International president, Karl Maier, called the deal “transformative” in a statement, positioning the company for as one of the leaders in providing pan-European infrastructure services.
“Viatel’s long-haul fiber network and colo assets combined with Zayo’s existing national UK, France, and US networks provides truly international, seamless connectivity for Zayo’s existing and new customers,” Dan Caruso, chairman and CEO of Zayo, said in a statement. “Our Pan-European infrastructure capability addresses new growth opportunities, including connectivity to key subsea cable systems delivering traffic to and from high-growth regions such as Asia and Africa.”
Boulder, Colorado-based Zayo has grown primarily via acquisition. Besides its massive network assets, through its subsidiary zColo, the company provides data center colocation services in 45 facilities across 30 markets, totaling more than 500,000 square feet.
Last year, Viatel announced a plan to invest €125 million in expansion of both data centers and fiber infrastructure in its portfolio.
Viatel’s data centers in Europe are located in:
Again, its Irish assets are not part of the acquisition.
11-11-2015, 17:24 #2
Microsoft’s opening data center doors in the UK and has a cunning plan in Germany
It looks like there’s one group that’s set to benefit from the Safe Harbor chaos – those who build and run data centers in Europe.
With the striking down of the Safe Harbor regulations and no sign yet of transatlantic agreement on a replacement, more and more US cloud providers have taken the decision to shore up their in-region data residency options to appease the more jittery among their customers.
Yesterday at the Future Decoded conference in London, Microsoft CEO Satya Nadella announced that the firm would for the first time be opening two UK data centers next year. Microsoft is also expanding its existing operations in Ireland and the Netherlands.
Officially all of this has nothing to do with the Safe Harbor ruling. Nadella said:
By expanding our data center regions in the UK, Netherlands and Ireland we aim to give local businesses and organizations of all sizes the transformative technology they need to seize new global growth.
But Scott Guthrie, Microsoft’s executive vice president of cloud and enterprise, followed up his boss’s comments by adding that reducing data privacy concerns was a driver behind the new centers:
We can guarantee customers that their data will always stay in the UK. Being able to very concretely tell that story is something that I think will accelerate cloud adoption further in the UK.
In an interesting development, Nadella this morning popped up in Berlin to announce new data centers in Germany that will operate under the control of Deutsche Telekom as trustee. The German authorities are the most draconian in terms of data protection enforcement. It’s telling that Deutsche Telekom is involved in order, according to Nadella:
to ensure that a German company retains control of the data.
What this means in practice – or Microsoft hopes it will mean in practice, a less-than-subtle distinction – is that any US government request for access to data in those data centers would have to be made to the German authorities. Microsoft’s own staff will have no access to the data stored in the data centers.
That way, Microsoft hopes to avoid the situation it currently faces in Ireland, where the US authorities are demanding access to customer data stored on a server in Dublin, arguing that as Microsoft is a US company it comes under US jurisdiction no matter where it operates in the world.
It’s a major test case with potentially greater ramifications for the entire US cloud services industry than the scrapping of Safe Harbor. Microsoft has vowed to stand its ground right up to the Supreme Court if necessary.
But in the meantime, it’s doing its best to put as many barriers in place as possible for further interference.
Microsoft’s decisions follow commitments from other US cloud services providers to up their in-region presence within the European Union. Last week Amazon said it would be opening a UK center in late 2016 which will offer what CEO Werner Vogels calls:
strong data sovereignty to local users.
Salesforce has already opened data centers in the UK and Germany, with a French one set to follow next year. Meanwhile the likes of NetSuite and Box have also confirmed their own plans to set up operations within the EU.
None of this comes cheap. With the latest expansion factored in, Microsoft will have spent over €1 billion on its existing Dublin facility alone. As well as its new UK center, Amazon is also pumping a further €100 million into building a third Irish data center, taking its overall spend there to €3.7 billion.
But it’s clearly seen as money well spent. Apart from anything else, it opens up the public sector and financial services markets that bit more.
Julian Tomison, UK General Manager of Microsoft partner Avanade, says:
The investment validates the sector and will ultimately have a positive impact on the cloud industry. Collectively this will benefit the UK and the industry as customers feel they have more control over where their data is stored. Questions around data residency aren’t new, but at least now we have a new solution. Having data centers in the UK helps us stay competitive when prices and services are becoming uniform.
But others have questioned just now much of an impact such moves by the likes of Microsoft and Amazon really will have. Georgina O’Toole of analyst firm TechMarketView notes:
Both want to tempt reticent public and private sector customers with flexible, low-cost cloud applications and services backed up by performance, security and reliability guarantees. But we wonder just how much difference a data center sited on Blighty’s shores – as opposed to those of Continental Europe or Ireland (both companies already own Dublin facilities) – can make to boosting those capabilities and convincing customers they are getting a better deal.
But with Safe Harbor gone and a replacement still in limbo, O’Toole concedes that there is a positive message to be spun out of opening in-region centers:
It’s always hard to tell what direction the law will take, and whether at any point regulated UK organizations will be compelled to store data within UK boundaries.
But one thing we do know is that Safe Harbor is bad publicity for AWS and Microsoft. Opening UK data centers averts a potential backlash, expands capacity and builds a solid platform for future service growth.