Forecaster: European data-center market to reach 745 million euros by 2007

April 7, 2005 - Study examines data-center products and services in 14 European Union countries as well as the Czech Republic and Hungary.

A new report from BroadGroup (www.broadgroup.com) forecasts that revenues for data-center products and services in the countries it recently surveyed-the 14 European Union countries plus the Czech Republic and Hungary-will more than double 2003 levels and reach 745 million euros by 2007.

The report, "Data Centres Europe," says that new and differentiated data-center products an services are shifting the business model away from basic collocation and Web hosting. A number of factors are fueling the market's growth, including a broadening of the customer base, the provision of managed services, regulatory requirements in the financial-services sector, and new conditions emerging for investment. The report cites business continuity and disaster recovery as major concerns for end users.

The report also identifies a shift toward utility computing, although a small number of data centers had so far invested in the blade servers required to open new markets.

According to BroadGroup, the research shows that data centers are confronting new challenges in creating value-added and "sized" services for an increasingly diverse customer base. With the majority of data-center stock being four to five years old, and the introduction of transforming technologies, the industry is facing a further period of change.

Much of the future concern for data centers will focus on power, security, infrastructure, and connectivity, BroadGroup says. The main cost pressure affecting companies interviewed is raw electrical power. Carrier neutrality - where the data center can offer more than three independent connection routes - is favored, and operators are able to charge premium prices. Space also is a major issue, and the report examines the current status across cities in Europe.

The report views managed services as a major opportunity for data centers, but suggests competitive rivalry could emerge with integrators, who are strong in customer relationships and architectural solutions.

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