Digital Realty specialises in creating high-tech data centre real estate and operates by either buying and converting exiting property or designing and building new data centres from scratch. Its core business is in leasing wholesale data centre space, although over recent years Digital Realty has expanded into the colocation market by using its extensive global network of owned and purchased buildings.
In October 2015 this sideways expansion was complimented by Digital Realtys acquisition of the TelX Group in a $1.9 billion deal. TelX was one of the largest colocation companies in the USA and of its 20 data centres, 11 of them were leased from Digital Realty. The purchase enables Digital Realty to both dominate the colocation market in America and capitalise on demand for direct enterprise to cloud services which were being developed by TelX. In December 2015 the company announced the first direct to cloud link under its new structure to IBM Cloud, named Direct Link Colo.
Digitals space options are comprehensive and start at colocation racks and cages building up to entire suites, data halls and individual buildings. If required, the data centres can be fully fitted out and ready to move into. Colocation services are offered with a huge variety of options, even down to availability of dedicated cross connects. Colocation comes with remote hands services from experienced technicians and a certain level of planned and reactive maintenance.
Location
Digital Realty is ultimately headquartered in San Francisco in the US, but it has regional head offices in London, Singapore and Australia.
It owns 140 data centres across Europe, the US, the Middle East, Asia and Australia covering almost 25 million sq. ft. and 32 markets. Many of those data centres are certified to ISO 27001 for Information Security and are leased either as full buildings or portions thereof.
Globally, Digital Realtys data centres have an average uptime of 99.9999% over the last seven years which is one of the highest uptimes in the industry. All data centres benefit from full CCTV, full time security staff, manual ID validation and physical access security technologies. Other aspects vary between the 140 data centre sites.
Energy
Digital Realty has always taken a proactive approach to energy management, both to widen its appeal to customers and to reduce its own impact on the environment. Many of its data centres are certified to ISO 50001 for Energy Management Systems and ISO 14001 for Environmental Management. For UK customers of Digital Reality, ISO 50001 leads to automatic compliance with the governments new Energy Savings Opportunities Scheme (ESOS).
In addition Digital Reality invests in sustainability through energy management and technological innovation, voluntarily complying with international standards when they arent mandatory. It is also a member of the Green Grid and was one of the first companies to utilise the Power Usage Effectiveness (PUE) to measure energy efficiency.
Funding/business model
Digital Realty Trust Inc. is a Real Estate Investment Trust (REIT), which is registered on the New York Stock Exchange. It was founded in 2001 and went public in 2004 with 24 data centres under its belt. It has subsidiaries in most of the countries in which it operates. In the UK, for example, Digital Realty (UK) Limited handles the UK and European side of the business.
Digital Realty is experiencing a period of rapid expansion and growing turnover. In the second quarter of 2015 it recorded a 5% growth in revenues over the same time last year. It follows a strategy of capital recycling – selling off poorly performing assets at a profit and pouring the proceeds into investment in prime development with better returns.
Customers and partners
Digital Realty has more than 1000 business customers, many of them leasing wholesale data centre space and some using colocation services. One of Digital Realtys biggest clients is colocation provider Equinix, who rent multiple data centres on long leases. Equinix was also TelXs biggest competitor. Other big brand customers of Digital Realty include IBM, Facebook, AT&T and CenturyLink.
In 2015, Digital Realty partnered up with GMEX Tech to create electronic trading hubs in its properties in order to host servers that are geared up for financial trading. The first of these was created in its Chessington, UK data centre in October to cover European emerging markets and a second is planned for Chicago to cover emerging South American markets.
A rapidly expanding enterprise offering
Digital Reality might specialise in cost-effective, high tech wholesale data centre space, but its recent quiet move into comprehensive colocation and connectivity services has opened it up to an entirely new market with plenty of demand. Digital Realty is a respected developer of data centres and boasts some of the biggest global brands at its properties. Its colocation services are probably still at the pricier end of the scale and unlikely to suit smaller businesses, but for enterprises looking for a stable, established and growing service provider, Digital Realty is a very safe bet.