The market share leaders are poised to pursue more AI workloads in 2025, while also expanding their data center portfolios and addressing energy consumption issues.
Think of colocation as the storage shed of enterprise IT: a convenient place to park assets that don't fit in one's domicile.
Of course, a colocation data center is considerably more sophisticated than that trusty outbuilding next to the garden plot and a red wheelbarrow. Such facilities offer megawatts of power, cooling, physical security, network connectivity, remote hands and space -- lots of it. The colocation industry, collectively, offers millions of square feet for customers' computing and storage needs. The top providers' individual data centers often exceed 100,000 square feet. (Your garden shed probably isn't bigger than this.)
For IT buyers, colocation providers offer a highly scalable IT infrastructure tier that can operate alongside on-premises data centers and cloud computing resources.
5 top colocation providers
What follows is a rundown of leading colocation vendors to watch in 2025 and what they offer customers. The vendors listed below are the top five companies ranked in Structure Research's global data center colocation leaderboard. Structure Research, a research and consulting firm with headquarters in Toronto, based its leaderboard on 2023 market share, the most recent year for which the company compiled colocation data.
Equinix
Equinix, based in Redwood City, Calif., operates 268 data centers in 73 metropolitan areas, offering more than 34 million square feet of space globally. In addition to colocation, the company offers digital services, interconnection services and support services. AI is becoming more important for Equinix: Adaire Fox-Martin, the company's CEO and president, cited "steadily building" enterprise demand for AI-related workloads during an October 2024 earnings call.
Provides access to about 2,000 networks and 3,000 cloud and IT service providers.
Offers Equinix Smart View, an on-demand software platform for monitoring data center infrastructure.
Reduced operational emissions by 24% from the company's 2019 baseline, according to Equinix's October 2024 earnings call.
Has alliance partners that include AWS, Cisco, Dell Technologies, Google Cloud, HPE, Microsoft Azure and Oracle.
Has reseller partners, which provide deployment and maintenance among other services, that include Accenture, Atos, Deloitte, Rackspace and World Wide Technology.
Key takeaway
Equinix's 73-city global presence, which the company cites as a point of differentiation, spans 34 countries and six continents. Most companies take advantage of this geographic reach: 90% of customers tap Equinix resources across multiple metros, while 76% use Equinix across multiple regions, according to an investor presentation.
For IT buyers, colocation providers offer a highly scalable IT infrastructure tier that can operate alongside on-premises data centers and cloud computing resources.
Digital Realty
Digital Realty, with headquarters in Austin, Texas, offers more than 300 data centers in more than 50 metropolitan areas worldwide. The company's data center portfolio encompasses about 41.1 million square feet. Core offerings include data center, colocation and interconnection services. The company works with customers in industries such as financial services, healthcare, insurance, manufacturing, media and entertainment, public sector, retail, transportation and utilities.
Market share: 6.3%*
Notable offerings and attributes
Offers high-density colocation services, geared to AI and big data deployments, in more than 30 markets.
Cites AI as an "early days" demand driver, expecting initial demand for training models and, eventually, connectivity demand for inferencing.
Has a global reach that covers more than 25 countries and six continents.
Operates 126 data centers powered through renewable energy, with 1.4 gigawatts of wind and solar capacity worldwide.
Has partners that include AWS, Google Cloud, HPE, IBM, Microsoft Azure, Nvidia and Oracle.
Key takeaway
The company cites its ServiceFabric Connect offering as a differentiating factor that supports hybrid IT infrastructure. ServiceFabric links customers, using virtual private connections, to cloud service providers, network providers and SaaS vendors. Available resources include more than 150 Digital Reality facilities, more than 375 third-party data centers and more than 110 global cloud regions, according to an investor presentation.
China Telecom
China Telecom operates more than 450 data centers in China and more than 180 facilities in other regions worldwide. The company offers 10 Gbps internet access; Tier IV data centers with high-density power and cooling systems; and managed services, such as disaster recovery (DR). China Telecom focuses on four technology directions: network, cloud and cloud-network integration, AI and quantum/security, according to the company's 2024 Interim Report release.
Market share: 5.4%*
Notable offerings and attributes
Offers Elastic Connection Platform interconnection service providing cloud-to-cloud and on-premises-to-cloud integration.
Added 12 green data centers in 2024.
Has ISO 27001 and ISO 9000 certifications, among others, at its colocation facilities in the Americas.
Has certifications from AWS, Cisco, Dell and Microsoft, among others, amid its data center engineers in the Americas region.
Key takeaway
China Telecom plans to develop intelligent computing that integrates AI, data and applications. The company's approach layers SaaS applications, proprietary and open source large language models, and data sets on top of its intelligent computing platform. That platform, dubbed Xirang, provides network scheduling, management of GPU clusters, and integrated AI model training and inferencing. In international markets, the state-owned company's Americas subsidiary faced increased scrutiny in late 2024: The Department of Commerce, based on its preliminary findings, notified China Telecom Americas that its presence in U.S. networks and cloud services presented a national security risk, Reuters and other news outlets reported.
Key data center colocation trends
AI. Colocation vendors are designing data centers to handle AI workloads.
Sustainability. Green computing initiatives focus on liquid cooling and expanding use of renewable energy.
Data center infrastructure management. DCIM tools monitor data center operations, including energy use, which contributes to sustainability objectives.
Integrated platforms. Colocation vendors' platforms provide resource orchestration, interconnection and management.
Emerging technologies. Some vendors are investing in areas such as photonics and quantum computing.
China Mobile
China Mobile, another major Chinese telco, is expanding its data center reach with an emphasis on AI infrastructure. In 2023, the Beijing-based company launched 13 intelligent computing center nodes in Western China. A facility that opened in Hohhot, Inner Mongolia, has 670 teraflops of computing capacity and is said to be the world's largest telco-built intelligent data center. China Mobile International (CMI), a Hong Kong-based subsidiary of China Mobile, provides telecommunications and IT services to international markets. CMI's resources include data centers in Frankfurt, Hong Kong, London and Singapore.
Market share: 4.6%*
Notable offerings and attributes
Established an AI research institute and aims to build new AI infrastructure.
Offers remote hands service that includes equipment restart, equipment installation and testing, and systems configuration and testing.
Provides site operations and maintenance, troubleshooting and database backup, among other offerings, via its outsourcing service.
China Mobile's data center capacity appears set for continued growth. The company is working on the Chinese government's Eastern Data and Western Computing initiative. This effort aims to build data centers in Western China, where land is less expensive and renewable energy more abundant. In that context, China Mobile's 2024 data center rollout "laid the groundwork to establish a nationwide computility network," according to China Mobile's 2024 Interim Results report. The telco defines "computility network" as public infrastructure that integrates networking, cloud computing, AI, security, edge and blockchain. The company's international business, however, hit a roadblock in the U.S. A San Jose, Calif., data center had been in development, but in 2022, the Federal Communications Commission deemed state-owned China Mobile a national security threat.
NTT Global Data Centers
NTT Global Data Centers is a division of NTT Data, an IT services and consulting company. NTT Data, in turn, is part of Tokyo-based NTT Group, which houses IT and telecommunications businesses. The division's resources include more than 120 data centers in 30 cities, spanning the Americas, EMEA and the Asia-Pacific region, including India. NTT Group plans to invest more than $10 billion in data center expansion through 2027, with efforts underway in Virginia; Paris, France; and Noida and Chennai in India, NTT Data reported.
Market share: 4.2%*
Notable offerings and attributes
Designs data center infrastructure to accommodate high-density AI workloads and provides ongoing monitoring, support and maintenance for such environments.
Uses liquid immersion cooling and direct contact liquid cooling at some data centers as part of a zero-emissions commitment.
Pursues an all-photonics network to create distributed data centers.
Received an investment from TC Global Investments Americas, a group company of Tokyo Century Corp., for its Chicago data center.
Offers implementation services and remote hands support.
Key takeaway
NTT Global Data Centers aims to boost the integration of its data center business with other IT services within NTT Data. Another element is tapping NTT's telecommunications background to connect data, noted Yutaka Sasaki, president and CEO of NTT Data, in the company's Integrated Report for fiscal year 2024. He cited the example of an integrated banking cloud that brings together data centers and middleware.
Colocation drivers: Scalability and beyond
Colocation companies serve as an option for businesses that have run out of capacity in their own data centers. But there are other demand drivers beyond on-premises space limitations. Rapid digitalization, as was the case during the COVID-19 pandemic, compels some organizations to tap colocation services. Edge computing also fuels colocation, enabling businesses to provide computing nodes closer to users or data sources without having to build their own infrastructure.
Colocation can also play a role in IT resilience and DR plans. Housing equipment in a colocation facility avoids the cost of building a backup data center. This approach can also geographically distance the secondary site from the primary data center. In addition, some specialized colocation data centers support the power and cooling needs of compute-intensive AI infrastructure -- GPUs and the like.
*Market share figures provided by Structure Research.
John Moore is a writer for Informa TechTarget covering the CIO role, economic trends and the IT services industry.
