How Colocation Can Help Partners Boost Profit

By Todd R. Weiss

Colocation services are booming, with estimates of annual growth exceeding 14 percent through 2022, according to recent research.

With that growth continuing, Kirk Killian, president of Partners National Mission Critical Facilities (PNMCF), will speak at the Channel Partners Conference & Expo about how partners can capture and monetize colocation business opportunities. The session, “Mastering Colocation to Maximize Profit,” April 11, is part of the cloud and colo conference track, sponsored by Nextiva.

PNMCF’s Kirk Killian

Killian, who advises clients in selecting and procuring data-center capacity, colocation suites and telecom switch facilities worldwide, has worked at PNMCF with a wide range of clients since 1999, including Walmart, Citi, T-Mobile, Verizon, Southwest Airlines, HSBC, Charles Schwab, Wells Fargo, Marsh McLennan, Western Union, Acxiom, Jack Henry and Chubb/ACE Group.

We spoke with Killian ahead of the event to get insights about the colocation market. His responses have been edited for length and clarity.

Channel Partners: How can partners prepare for the expected continuing growth in the colocation marketplace?

Kirk Killian: Channel partners can become familiar with recent trends in colocation data-center design and delivery, including edge deployments in markets not previously served by large colocation providers. Channel partners can also familiarize themselves with discounted bundled colo and network circuits offered by some interconnection providers [that] are expanding their colocation footprints. They can also learn about and focus on the geographic markets with the most competitive pricing and tax incentives.

CP: Are there steps they should be taking now to help maximize their profit?

KK: When helping clients select additional network POPs (point of presence) or setting up telecom circuits for new IT projects, channel partners can assist in procuring colocation cabinets and cages for the IT equipment supporting those new projects. They can also establish referral relationships with the colocation leaders to get information about specific facility openings and new referral promotions that usually accompany them.

CP: Are there new colocation services they can add to their offerings?

KK: Yes. Colocation providers have broadened their offerings to include more managed services, including private cloud and direct connect into the public cloud providers, plus expanded their geographic availabilities. As the colocation market has matured, the proliferation of additional colo providers – at both ends of the services/pricing spectrum – makes it more likely than ever that a knowledgeable channel partner can match their client’s needs with a tailor-made colocation solution.

CP: How can partners compete in a growing colocation marketplace? How can they stay ahead of the competition?

KK: Certainly, market knowledge coupled with good client service are powerful tools to serve end-user clients well. Understanding the strengths and weaknesses of different colocation providers, and the locations most suitable for client deployments, helps them match specific client projects with …

… available capacity. Especially when some end-user clients aren’t aware of the different ways to build flexibility into colocation contracts, helping them craft contract structures is a great partner differentiator.

CP: How can partners enhance their deployments and contract flexibility to entice customers to use their services?

KK: Growth in cloud computing and the variety of colocation offerings has led the end-user community to demand more contract flexibility. Channel partners can respond by tailoring their referral process and fee structure accordingly when flexibility is a paramount goal for some clients.

CP: Are there ways for channel partners to differentiate themselves for customers?

KK: A key challenge is demonstrating industry knowledge while appreciating ways channel partners can creatively suggest solutions to meet specific client needs. I’ve found that presenting case studies showing the value created by partners in meeting specific client needs helps prospective clients separate partners that seek to improve overall value form those who only seek another fee.

CP: What should customers be seeking when looking for a colocation partner? And how can channel partners work to meet those requirements?

KK: A well-designed and professionally operated facility is just the beginning. Customers should seek partners that seek win-win solutions, especially including flexible solutions, instead of high-cost contracts. Customers benefit from providers with great telecom network interconnectivity to maximize network resiliency and minimize latencies, especially valuable in the modern push toward edge deployments.