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Posted by Matt Edgley on 22-Jul-2021 16:20:26

OPINION: Is Manchester running out of data centre space?

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Well, maybe that's a little too alarmist as a title question - but in recent years, Manchester really has emerged as a data centre hotspot. The city is booming and positively established as being the tech hub of the North, with names such as Amazon, Huawei, the BBC and The Hut Group (THG) drawn to the region in recent years.

This has happened for a number of reasons. 

Historically, users would need to be in London to get the best connectivity. So most big businesses made London their home. In fact, Manchester used to be viewed by many as simply an effective DR location to primary kit in London, but thanks to the extension of core fibre networks and peering exchanges into the Manchester region, this is no longer the case. Many major businesses have relocated to the North following the development of areas such as Media City and Airport City, and the quality of Manchester based data centre providers, combined with the growing networks and cost advantages, has resulted in Manchester being seen as a very attractive primary option. 

However, this increased take-up hasn’t been matched by an increase in data centre providers in the area. Which is creating a shortfall. Supply and demand isn’t quite tallying up. There has been expansion in the area for sure, but has it been enough to keep pace? Why has the data centre industry in Manchester been slow to catch up?

Data centre expansion in Manchester has been hindered by continued consolidation. The number of growing independents has dwindled as some of the major names have grown through acquisition. This has delayed potential expansion plans while some have been cancelled altogether.

Investment cost is another big factor. In a risky environment, even at a time when data centre take-up is high, it’s a huge commitment. Especially for the few remaining independents in the city. Embarking on new site development isn’t something that providers take lightly - even more so given the financial uncertainties surrounding the covid-19 pandemic.

Newcomers to the region have also been extremely limited in recent years. This, coupled with continued consolidation means there is less choice for the end user and reduced competition and supply.

The data centre providers that are expanding and planning new facilities are finding that they are filling space quicker than they can build it. Especially with the advent of Edge computing which is seeing major names in tech move key point-of-presence regionally, to deliver on their Edge strategy, moving their content closer to the user. Capacity uptake is taking providers by surprise, and with the time it takes to source, secure, plan, design and build a facility, it's clear why unavailability can hit providers.

Take Teledata for example. As we embarked upon the build of our third data centre, the entire facility was taken by a social media giant who ended up with a private build due to their large requirement and demanding specifications. We announced that we were starting to build our fourth data centre, and the same thing happened again. Before these server halls were even built, the space had been sold. Although we do still have some space available, we’re now investigating options for further expansion in some preferred locations and we hope to be able to share more detail on this soon.

As capacity reaches a critical point in some facilities, some providers are filling their data centres and rack space with their own managed services or cloud solutions, which naturally deliver higher revenue than straight forward colocation.

All of this means that the gains that Manchester has made as a digital city, could potentially be stunted unless providers keep pace with the needs of the market.

Topics: colocation, data centre, cloud, growth, tech

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