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Verizon Launches Auction To Sell Data Centers (reuters.com)
operator_error writes: Verizon has now chosen to reverse "its strategy to expand in hosting and colocation services after it acquired data center operator Terremark Worldwide Inc in 2011 for $1.4 billion", and has "started a process to sell its data center assets". The so-called 'colocation' portfolio up for sale includes 48 data centers, and generates annual earnings before interest, tax, depreciation and amortization of around $275 million. The enterprise telecommunications industry has had to adapt in recent years to corporate customers seeking more sophisticated and cheaper offerings to manage their data. Verizon joins a host of its rivals in telecommunications who are shedding their data centers.
don'cha think?
So they get rid of the assets and charge whoever buys them through the nose for connectivity, since they'll still own the fibre running into the building, so they cut the expenses for maintaining the building, and get a revenue stream for the ongoing future...
Not a bad idea really.
I bid $1
require an NSA risk adverse buyer.
They bought spectrum which is the property of the people, agreeing to use it fairly. Yet they prohibit devices on their net and require them to go through long "testing" processes that can take up to a year - on devices that have two year shelf lives. They are also against net neutrality.
I figure if it is bad for Verizon, it is good for the public in general.
This is a sign they plan on taking net neutrality seriously... at least for now.
I wouldn't be too surprised if Microsoft bought some, gutted them, and fitted them with new racks of up-to-date gear. Right now MS is desperately in need of physical server space because their Azure stuff is actually (surprisingly) getting a lot of traction.
They literally cannot build datacenters fast enough so they've taken to leasing buildings and then doing the gut/harden/refurbish thing to them, turning them into colos and full-fledged DCs.
An existing DC would be a prime candidate for this as it's already a DC and would only need modern racks and servers. Cooling, power, and physical security are already there and that's what takes the longest to complete. Rack installation, on the other hand, can be done very quickly.
Just cruising through this digital world at 33 1/3 rpm...
Obviously high- end networking hardware DOES need to be replaced pretty often, perhaps every 5 years or so.
The claim that an enterprise storage system loses half its value in a year because drives get bigger is a bit silly, though. Several years ago I bought storage hardware for our datacenter. It was filled with 400GB drives. The same sleds now hold 4TB drives, connected to the same expanders, the same RAID cards, and the same storage logic. The actual hard drives are less than half of the cost of the total system.
Assuming a five-year lifespan, you'd figure 20% per year on your networking equipment. A bit longer on your racks, even longer for your raised floor etc.
Obviously, Verizon will simply rent data center resources from the new NSA data center in Utah. It will make sharing our information much simpler.
It must have been something you assimilated. . . .
Verizon should stop entering other businesses with profits from its landline and wireless businesses. Verizon also bought AOL, which is mostly a bunch of websites, including the Huffington Post now. It's one thing to send the profits of one's monopoly back to the shareholders. It's another thing to spend it on money losing investments, and high pay for upper management.
There are a couple of major outfits that could purchase these data center assets. But I'm thinking they're more interested in the real estate rather than the operations. Wonder if this sale includes Edgecast?
With all the hacking going on, and fears over NSA involvement in almost every datacenter in the country, individuals and corporations are moving to in-house cloud solutions. And, it's happening in a really big way.
There is growing, and justified perception among members of the corporate ecosystem that, if your data is in the cloud, NSA has full, unfettered, and undocumented access to it, and is looking at it.
Data centers suffer from very rapid capital depreciation. Kryder's Law means your storage hardware loses half its value every 13 months. It is a very competitive business, and only large scale automated data centers can be competitive. This is the start of the shake out, not the end. You will soon see more companies exit the business.
Until someone tells them data centers = cloud infrastructure. Seriously, if they want to be a cloud provider then they need the biggest most massive and efficient data centers. Or are we talking purely about small and medium data centers and colocs?
Sure, co-location is far too expensive relative to provisioning on-demand cloud infrastructure to justify for small and medium size businesses. And large businesses can set up their own data centers in-house. I could see some medium to large businesses buying these data centers just to avoid having to build their own from scratch.
The cloud will always suffer from the problem of physical custody of data. Where some data is too sensitive to trust to someone else's security even if that security is probably better than your own.
But for everything else the cloud is where it is at.