Equinix, CenturyLink-Savvis Lead U.S. Colo Market

The colocation services market has grown to maturity, with the segment growing by 8 percent year over year in the third quarter of 2013, according to a report from Synergy Research Group. With the growth, the colocation services market is now valued at $1.6 billion. And based on the report, two leaders are top.

Equinix (EQIX) is leading the market with 18 percent market share, whereas CenturyLink-Savvis (CTL) is following with 8 percent of the share. Competitors after that include SunGard (5 percent), AT&T (5 percent), Verizon (5 percent), Telx (4 percent), CyrusOne (4 percent), Level 3 (3 percent) and Internap (2 percent). The following 10 operators make up 12 percent of the total market, with the remaining 34 percent falling into the hands of other smaller operators.

The clear market leader is Equinix, whose revenue grew to the point that it distanced itself even more from its nearest competitors. CenturyLink is a solid No. 2 player currently, but a tight grouping following it isn’t so far behind as to not be a concern.

“The U.S. colocation market is the most mature and well-developed in the world, with revenue levels more than four times the size of its nearest rivals, the United Kingdom and Japan,” said John Dinsdale, a chief analyst and research director at Synergy Research Group, in a prepared statement. “Looking ahead, the adoption of cloud infrastructure services will act as a damper on some aspects of the colocation market, while stimulating others. We forecast that U.S. colocation revenues will grow by a CAGR of 7 percent over the next five years.”

With many colocation services providers in the US market, it’s interesting to see one player take such a lead; and it gives it an advantage over its competitors.