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Monday, June 19th, 2017

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    12:00p
    TierPoint Now Has a Huge Rival in Secondary Markets

    If there was one easy critique to make about Peak 10 before it announced the agreement to acquire ViaWest earlier this month it would be that it didn’t have any data centers west of Kentucky.

    “They didn’t’ have anything very far out west so disaster recovery possibility and overall reach could’ve been better. The ViaWest acquisition solves that,” Dan Thompson, senior analyst at 451 Research, said.

    If and when it closes, the $1.67 billion deal to take Denver-based ViaWest off the balance sheet of its current owner, the Canadian telco Shaw Communications, will not only give Peak 10 nation-wide reach, it will make it one of the two biggest player in so-called tier-two US data center markets. The only other player in those markets of comparable size is TierPoint, according to analysts at Structure Research, who were hard pressed to determine which of the two companies would actually be bigger post-merger, concluding at the end that they would share the number-one spot among secondary-market players in terms of colocation revenue.

    See also: How TierPoint Quietly Built a Data Center Empire in Secondary Markets

    The acquisition expands Peak 10’s reach from 16 data centers in 10 markets to 40 data centers in 20 markets, reaching as far west as Portland. The combined company’s total data center capacity will be 2.7 million square feet and 90MW of power, Mike Fuhrman, Peak 10 CTO, said in an interview with Data Center Knowledge.

    What’s the Big Deal with Scale Anyway?

    So, why is scale so important for a data center provider? Mergers by companies targeting top markets and those focusing on secondary markets have accelerated recently, with most of the deals made primarily to expand the buyer’s scale.

    Besides the obvious benefits of economies of scale, expanding into new geographic markets is a key way for providers to grow revenue. “There’s a tremendous pressure to continue to grow,” Thompson said. “That’s why you see a lot of them scaling out.”

    After being in any single market for five or so years, your growth potential in that market starts to wane, and entering new markets is a way to counter that.

    Specifically in Peak 10’s case, expanding geographic reach is also a way to attract larger customers than its traditional small and mid-size business base. Larger enterprises typically need data center capacity in more than one or two locations, so they naturally gravitate toward national players.

    Peak 10 has been adding larger customers to its base over the last two to three years, and broadening its geographic reach was necessary to continue that trend, Fuhrman said.

    TierPoint has been on a similar trajectory, according to Philbert Shih, managing director at Structure, and it now has a rival to compete with toe-to-toe. “Both companies have trended toward bigger customers over time, with bigger spend,” he said.

    New Skills

    Both companies also have a variety of cloud and managed services capabilities, and so does ViaWest, which in addition to scale also bulks up Peak 10’s skill set in that department. Such up-the-stack services, integrated with colocation, are important for a service provider catering to SMBs and larger enterprises who don’t necessarily have those skills in-house.

    Roughly 60 percent of Peak 10’s revenue today comes from colocation services, Fuhrman said. The rest is split about evenly between cloud (including private cloud and multi-tenant disaster recovery) and managed services. He expects the non-colocation portion to increase over time but doesn’t forecast a slow-down in the colocation business.

    While ViaWest and Peak 10 have many similar capabilities, the area where the deal brings net new skills is consultative professional services around security and infrastructure. The bulk of ViaWest’s capabilities in this area came when it acquired AppliedTrust in 2015. Now, 70-plus experts across business intelligence, voice, video, and other enterprise IT infrastructure domains join Peak 10, which would otherwise rely on partners for that expertise, Fuhrman said.

    A growing area within the managed services category for companies like Peak 10 is managed public cloud. ViaWest adds a managed Amazon Web Services capability to Peak 10’s portfolio, including professional services to help clients integrate public cloud into their architecture. Fuhrman said the company plans to grow that capability by adding more cloud providers to the mix, such as Microsoft Azure and Google Cloud Platform. “I definitely see that as an opportunity for us,” he said.

    A Wave of Consolidation

    This is the latest in a string of acquisitions in the data center provider industry as it goes through a wave of consolidation. Also this month, Digital Realty Trust announced its blockbuster $7.6 billion acquisition of the pure-play wholesale data center landlord DuPont Fabros Technology. Earlier this year, CenturyLink offloaded its data center business to a group of investors that later launched a data center provider called Cyxtera, and Equinix closed its $3.6 billion acquisition of a massive Verizon data center portfolio. The CenturyLink, Verizon, and Shaw deals are similar in that the three telcos all have sold data center companies they acquired a few years ago.

    See also: DuPont Fabros Acquisition Gives Digital Realty More Firepower in the War for Cloud Deals

    Also this year, a company called Digital Bridge continued the buying spree it started in 2016, acquiring Silicon Valley wholesale heavyweight Vantage Data Centers, the regional Utah player C7 Data Centers, and two individual facilities from 365 Data Centers. In April, 365 was itself acquired by a group of investors intent on growing it by buying up more data center companies.

    See also: Meet Digital Bridge, a New US Data Center Market Consolidator

    No Plans to Enter Top Markets

    While its strategic focus has been in tier-two markets, the ViaWest acquisition gives Peak 10 presence in the red-hot Dallas-Fort Worth market. But Fuhrman doesn’t expect the company to enter into more top markets any time soon. He sees a significant growth opportunity in secondary markets today, as the Internet of Things drives demand for compute capacity everywhere, and on the map of the two companies’ combined footprint, almost every tie-one market has a facility that’s tethered to a Peak 10 or a ViaWest data center, he said. “We’re pretty happy with the reach that we have with these 40 data centers in 20 markets.”

    Correction: A previous version of this article incorrectly said Peak 10 derived 60 percent of its revenue from non-colocation services. Colocation services are where it derives 60 percent of revenue from, and the article has been corrected accordingly.

    4:55p
    Nevada Governor Vetoes Renewable Bill in Setback for Advocates

    Mark Chediak (Bloomberg) — Nevada Governor Brian Sandoval vetoed a bill late Friday that would have boosted the state’s renewable energy target, dealing a setback for clean-energy advocates looking for state action after President Donald Trump said he would pull the U.S. from the Paris climate pact.

    The legislation required that 40 percent of the state’s electricity come from clean energy sources by 2030, up from the current target of 25 percent by 2025. The Nevada Resort Association, a casino trade group, called the mandate premature because the state was starting to deregulate its electricity market through a November ballot measure.

    The group also said that the measure could increase energy prices. Bill backers said those concerns were unwarranted as the cost of solar and wind power continues to decline.

    More on renewable energy and data centers in Nevada:

    While the promise of the measure is “commendable, its adoption is premature in the face of evolving energy policy in Nevada,” Sandoval said in a statement issued with his veto, which was posted on the state’s website. The Republican governor said he would direct an energy committee to study increasing the renewable mandate with recommendations provided to him and the 2019 legislature.

    The decision comes as clean-energy advocates enlist states, municipalities and corporations to pick up the mantle of combating climate change after Trump’s decision to leave the landmark international environmental agreement. Earlier this month, nine states, including California and New York, and the leaders of 125 cities pledged their support to policies to reduce emissions and meet the Paris accord. Nevada hasn’t signed on with the group.

    See also:

    The Nevada bill would have added about 1.7 gigawatts of solar to the state by 2030, nearly double the current amount, said Dylan Sullivan, a senior scientist at the Natural Resources Defense Council. The measure received support from environmental groups, MGM Resorts International — which broke with the casino trade group — and companies including EBay Inc., Levi Strauss & Co., and data-center operator Switch.

    Earlier this week, Sandoval signed a measure designed to revive the rooftop solar industry by boosting credits for excess energy produced by small systems.

    5:05p
    What the Average Worker Doesn’t Know About Security Will Scare You

    Brought to you by IT Pro

    As security becomes more complex organizations are tasked with making sure that it’s not just the IT department on the lookout for the next threat since malicious actors can get in from anywhere, particularly in a multi-cloud environment. Employees are being trained on cybersecurity best practices, and are adding words like ‘ransomware’ to their lexicon. But it still may not be enough.

    Cybersecurity training provider Wombat Security Technologies released the results of a survey this week that looks at the personal security behaviors of more than 2,000 U.S. and U.K. workers at work and at home. It’s worth noting that the study was conducted less than 24 hours before the WannaCry ransomware attack last month.

    The results shed some light on the level of knowledge around cybersecurity by the average worker, which obviously differs greatly from that of cybersecurity professionals, who Wombat said tend to overestimate the knowledge the general public has on cybersecurity risks.

    “This could be giving security professionals false confidence and may be the reason why just fewer than half of organizations have a security awareness training program for their employees,” Wombat VP of marketing Amy Baker said in a statement.

    The survey found that between U.S. and U.K. respondents, 50 percent of U.S. workers have been the victim of identity theft, compared to 19 percent of those in the U.K. Wombat said that this discrepancy could come down to awareness of cybersecurity best practices in general. For example, 54 percent of U.S. respondents believe a trusted location – such as a hotel or an airport – indicates a trusted WiFi network, compared to 27 percent of U.K. respondents who shared this belief.

    There is also a discrepancy between U.S. workers and U.K. workers in terms of their trust in antivirus software; in the U.S., 58 percent of respondents said that antivirus software would be able to stop a cyberattack, compared to 37 percent of U.K. respondents.

    U.S. workers are more likely than their U.K. counterparts to use a password manager, 38 percent compared to 10 percent, respectively. A recent report by Pew Research Center found that the majority of Americans (65 percent) memorize passwords in their head, while 18 percent write them down on a piece of paper; only 3 percent used a password management program.

    From an IT pro perspective, there are a lot of takeaways from the report, including the risks associated with employees using work devices for personal activities like shopping online and playing games. According to the survey, 71 percent of U.S. workers use their corporate laptop or smartphone at home, and nearly half (46 percent) allow family members and friends to check and reply to email on those devices, so even if you warn employees about security risks like phishing, their friends and family may not get the same message.

    Employees, and employers, are going to have to do a much better job as the Internet of Things (IoT) complicates the security landscape even further.

    You can read the report from Wombat in full on its website.

    This article originally appeared on IT Pro.

    6:55p
    Schneider Electric Beefs Up Its Family-Leave Policy

    For recent graduates and veteran specialists in science, technology, engineering, and mathematics, jobs are a dime a dozen. So, companies need to set themselves apart from their competitors in order to attract and retain qualified workers.

    Schneider Electric, which among many other things is one of the largest data center infrastructure suppliers, just announced changes to its Family Leave Policy designed to benefit current and future employees in their quest to create a healthy balance between work and personal lives. The new policy introduces a comprehensive benefits package to significantly improve its workers’ ability to maintain their careers, while supporting their families. Effective immediately, employees based in North America are eligible for:

    • 12 weeks of fully paid leave for primary care-giver (birth or adoption)
    • 2 weeks of fully paid leave for secondary care-giver (birth or adoption)
    • 1 week of bereavement for immediate family
    • 1 week of leave to care for elder or critically-ill family member (starting January 2018)
    • 2 floating days that can be used for cultural activities

    “Our refined family-leave policy ensures our employees have more paid time off when they need it, allowing them to avoid having to make a choice between work and their family. The well-being of our staff is our highest priority and we’re proud to champion this issue as part of our goal to be best-in-class in every area of our organization,” said Annette Clayton, president and CEO, North America Operations, Schneider Electric.

    Earlier this year, the company made family leave policy and medical plan updates in support of the company’s lesbian, gay, bisexual and transgender (LGBT) employees. Its paid family leave policy provides paid time off for primary and secondary care givers regardless of gender, and supports LGBT community members who choose to adopt. Additionally, Schneider Electric’s medical plan now covers gender reassignment surgery as part of its comprehensive benefits package.

    Schneider also addressed the fact that men make up 14 percent more of today’s workforce than women, according to the US Bureau of Labor Statistics, and the reasons why. As the primary caregivers for children, women often leave careers to raise families. Those who choose to return much later in life usually lack the skills necessary to work in a more advanced, modern world—especially in a continually evolving industry like technology.

    That’s why Schneider Electric said it is collaborating with iRelaunch, a leader in career reentry programming, to introduce an internship program in the U.S. focused on helping women with smooth returns to the workforce. This applies to women who take voluntary career breaks after more than three years and have more than five years of work experience in a manufacturing field prior to their break. The types of roles in the program include quality engineer, materials analyst, manufacturing engineer, manufacturing supervisor and support function roles.

    “It has become increasingly difficult for women to reenter the workforce after a career break, whether that’s due to child rearing or fulfilling other family obligations. Our collaboration with iRelaunch helps women better maintain their careers to ensure we as an industry can tap into female talent from both traditional and non-traditional career paths,” added Clayton.

    10:32p
    Using Object-based Storage to Replace File-Based NAS Architectures

     Erik Ottem is Director of Product Marketing, Data Center Systems, Western Digital.

    Editor’s Note: Part 1 of this two-part series explores Object-Based Storage as an alternative storage solution and its role in cost-effectively delivering data at scale.  As more OBS platforms become deployed, replacing traditional NAS file-based architectures in today’s data centers, IT managers are realizing other key benefits associated with OBS including its extreme scalability, advanced data availability and durability, and simplified data management – all of which will be covered in Part 2 of this article.

    The world is generating, storing, analyzing, transforming, and leveraging more data per year than in the previous 10 years combined – and it is expected to more than double each year going forward.  At this rate, according to an industry analyst, digital data will surpass 163 zettabytes by 2025, which would require 163 billion, one terabyte (1TB) drives, to store all of it.  That’s a lot of data being generated by billions of people, using millions of applications, on billions of PCs, smartphones and devices.

    Today’s data center is rapidly changing as enterprise clients now interact with it well beyond the physicality of the glass room – whether on-premises or in the cloud.  Clients connect to the cloud in ways that didn’t exist before as mobile devices have changed the way we communicate both professionally and personally.  Not only is data being generated from PCs and smartphones, but also from cars, robots, drones, surveillance systems, sensors, medical devices, wearables, etc.  At the same time, data associated with photos, video/audio streaming and social networking has grown exponentially.

    When we analyze these volumes of data and extract value, our lives become more enriched and leads to better decision-making.  But all data does not have the same intrinsic value.  So, the cost-effective approach to storing it is not always high-performance primary storage, but sometimes a performance-adequate solution with extreme scalability, advanced availability and durability, and simplified management, may be the better choice.

    Introducing Object-Based Storage (OBS) – an alternative storage solution that cost-effectively delivers data at scale and is replacing the traditional file-based Network-Attached Storage (NAS) architectures used widely in today’s data centers.

    Technology Overview

    Object-Based Storage is an architecture that manages data as objects as opposed to traditional block- or file-based approaches, and is a viable option for storing unstructured data at petabyte scale.  Unlike file-based storage that manages data in a folder hierarchy, or block-based storage that manages disk sectors collectively as blocks, OBS platforms manage data as an object.

    Network-Attached Storage is file-based with data stored inside of a folder/path (hierarchical storage), and must be traversed each time that data needs to be accessed.  Storage Area Networks (SANs) are block-based in which a collection of disk sectors are logically grouped into a block with a unique address.  In either case, there is little or no information about the data stored that can help simplify manageability or support ever-increasing amounts of data (or what is referred to as data at scale).

    With OBS, the totality of the data, be it a document, audio or video file, image or photo, or other unstructured data, is stored as a single object. Metadata is also associated with the object and provides descriptive information about the object and the data itself.  This eliminates the need for a hierarchical structure and simplifies access by placing everything in a flat address space (or single namespace).  The unique identifier assigned to each object makes it easier to index and retrieve data, or find a specific object such as a video or photo.  Since metadata is defined by users, when leveraged appropriately, enables data analytics or other information discovery techniques for a large volume of data at scale.

    Opinions expressed in the article above do not necessarily reflect the opinions of Data Center Knowledge and Penton.

    Industry Perspectives is a content channel at Data Center Knowledge highlighting thought leadership in the data center arena. See our guidelines and submission process for information on participating. View previously published Industry Perspectives in our Knowledge Library.

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