IDC VENDOR SPOTLIGHT

A GLOBAL PLATFORM FOR A SECURE,

CONNECTED, AND SUSTAINABLE
DIGITAL FUTURE
Author:

Andrew Buss

April 2021

Sponsored by

IDC #EUR147568121
A Global Platform for a Secure, Connected, and
Sustainable Digital Future
Introduction
The past decade has seen businesses begin to adopt digital
technologies, whether to enhance existing products and AT A GLANCE 
services or to bring entirely new digital-only offerings to
market. As we head into the 2020s, this is accelerating as KEY TAKEAWAYS 
companies look to cope with the speed and scale of market » As businesses become more agile through
changes. Music streaming has largely supplanted buying adoption of advanced digital technologies,
the role of the datacenter is changing.
CDs, while video streaming services such as Netflix and
Employees are becoming more mobile,
Disney+ have transformed how TV is made and delivered. customers are interacting digitally, and
Uber changed the model of taxi hailing and payments. Then data‐hungry technologies such as IoT and
the global pandemic changed Uber from a ride-hailing to a artificial intelligence are creating a more
connected world — and interconnected
food-delivery company. datacenters are at the heart of it all.
» NTT Global Data Centers designs, builds,
Business plans are already being rewritten and rewritten
and operates business‐critical
again, and will have to become more dynamic moving datacenters spanning more than 20
forward as they are constantly tested. The ability to be countries and regions. Customers receive
flexible power configurations, carrier‐
flexible and to adapt to new conditions will be key for
neutral telecommunications, optimized
ongoing business health, growth, and profitability. public cloud connectivity, and a best‐in‐
class overall experience.
To be more competitive, most companies are looking to a » In addition, NTT Ltd. offers a set of "full‐
hybrid IT approach of utilizing public cloud to augment their stack" services that help customers
existing IT service delivery, as well as modernizing their own design, build, and operate the agile and
flexible IT infrastructure that modern
IT infrastructure and processes to become more cloud like. digital businesses need to compete
effectively in a fast‐changing market. 
When it comes to datacenters, companies frequently
gravitate toward improving what is already in place. But is
this really the best thing to do? It takes a lot of upfront investment in equipment and skills, as
well as significant time, to upgrade on-premises datacenters — or to build new ones from
scratch. Many datacenters are also limited by suboptimal site characteristics such as fitting into
existing locations or buildings, or having a limited choice of communications service providers.
This often prevents them from being able to really deliver what the business really needs from
IT.

Datacenter colocation services offer an immediate way to dramatically improve IT service

delivery for most enterprises struggling to improve the flexibility and quality of IT that the
business is looking for, and which need to invest to bring often neglected datacenter facilities up
to the required standard. Colocation services offer the ability to deploy and scale datacenter
infrastructure capacity much faster than building your own, but also with world leading design
and build. For enterprises struggling to scale, colocation not only enables on-demand
infrastructure, but can also help to lower the overall total cost of ownership.
 A Global Platform for a Secure, Connected, and Sustainable Digital Future

As more companies move larger proportions of their IT infrastructure to colocation datacenters,

this is also a key enabler for public cloud and other service providers to integrate more closely
and securely with customers deploying critical hybrid cloud by being co-resident in a datacenter
facilities provider campus.

Benefits of Colocation
Colocation service providers play a significant role in accelerating digital transformation (DX). The
adoption of 3rd Platform technologies such as cloud, social media, mobile, and analytics has
significantly impacted the entire IT ecosystem, including the way enterprises interconnect to
cloud providers and provision of services by network and datacenter infrastructure providers.

FIGURE 1
Colocation Provides a Global Platform for a Secure, Connected, and Sustainable Digital Future

Source: IDC, 2021

Enterprises Can Overcome Technical Debt by Moving to a Datacenter Colocation

Provider
As enterprises undergo DX, their requirements for computing, storage, network, and power
continue to grow exponentially. This is impacting the role and expectations that the physical
facilities have to play in improving overall IT service delivery. For many companies, their
datacenters have evolved organically over time, and were not really designed to cope with the
demands now being placed on them. This is creating pressure to modernize datacenter facilities
as they transform into the "nerve center" of IT infrastructure and a crucial exchange and
crossroads for the entire IT ecosystem. But for most companies it's a challenge when it comes to
building a modern datacenter that can cope with the new level of expectations. Rather than
justifying the significant investment in skills and datacenter upgrades that would be required to
bring existing facilities up to scratch, many are looking to achieve the full benefits in an instant by
turning to colocation providers that have world-class facilities available to use as a service.

 
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Leading colocation providers have global scale, with hundreds of datacenters around the world
enabling companies to run their IT infrastructure easily in their preferred markets. With so many
datacenters under management, colocation providers have extensive experience in building
datacenters to cutting-edge standards for efficiency and sustainability. These are also regularly
being modernized and refreshed so that customers continue to benefit from leading-edge
capabilities over time.

In addition, colocation providers have large and concentrated market power when it comes to
networking and communications. They can use this influence to encourage multiple
telecommunications providers to invest in building high-performance network capacity to these
datacenter campuses, so that customers have access to a choice of world-class network and
interconnection service providers — a task that many enterprises struggle to provide to their
own datacenter facilities.

Public Cloud Providers Can Get Closer to Demanding Customers in a Colocation

Campus
For public cloud providers, colocation facilities also offer some compelling advantages. Even if a
significant amount of their total datacenter capacity is self-owned and built to world-class
standards by these providers, demand can shift rapidly and unpredictably. Cloud providers can
respond quickly by using colocation facilities to rapidly add capacity in key markets, closer to
where demand is growing quickest.

With increasing enterprise adoption of colocation for datacenter capacity, cloud providers can
also use colocation to reduce latency and other networking issues by being co-resident in the
same campus or even in the same data hall as critical customers to ensure demanding
workloads can be run at high performance and with end-to-end controlled networking and
security.

Trends in IT Infrastructure and Colocation Adoption

The Best-Run IT Invests in Advanced Capabilities and Delivers Enhanced Business
Revenue Growth
With the increasing digitalization of the global economy, companies that have the best designed,
built, connected, and operated IT infrastructure are the ones that are most flexible and able to
adapt to changing market conditions. IDC research1 shows that these companies make up about
a quarter of companies overall, and that they invest in a digital platform by investing significantly
in a range of advanced IT infrastructure capabilities, including:

 Real-time data and analytics

 DevOps and API-centric development
 Digital trust and formal risk management
 Multicloud service adoption
 Artificial intelligence and machine learning in business relevant use cases

 
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 Automation and orchestration, AI-enhanced infrastructure management and

programmable infrastructure

These leading companies with an advanced digital platform realized much higher revenue
growth compared with the market as a whole, showing that investment in advanced IT
infrastructure pays off through being better able to capture existing markets or to move into
new ones with a secure, agile, and flexible IT foundation.

Moving IT Infrastructure Toward an as-a-Service Model

A key trend is that the most advanced adopters of the digital platform are looking at new ways to
approach things. This is reflected in their strong adoption of public cloud to help deliver better IT
services compared with the rest of the market, as well as using leasing- or consumption-based
approaches to fund their investment for on-premises IT infrastructure. This shows that the
companies with the most advanced IT infrastructure are moving toward monthly recurring
payments to fund IT transformation and improvement rather than having to put a significant
amount of cash up front, which can eat into precious cash reserves.

So, if digital platform leaders are moving away from heavy upfront costs and are open to
bringing in cloud and consumption models to deliver agile IT, what does this mean when it
comes to where and how they host their own IT infrastructure?

Transforming IT Service Delivery by Leveraging Best-in-Class Partners for World-

Leading Datacenter Facilities
When we looked more closely at how enterprises host their own IT, colocation is already well
accepted by the market as a whole, with just over half the market making use of colocation
services to some degree. But digital platform leaders take this to another level, with three-
quarters making use of colocation facilities to provide some level of their overall datacenter
capacity.

What is it about colocation that is so attractive for these companies with the most advanced IT
infrastructure?

There are many reasons for companies to choose to use third-party specialized datacenter
providers and chief among them are for better business continuity and ease of geographical
expansion. But beyond these business benefits there are a number of compelling reasons to
consider partnering with a specialized datacenter provider to host your IT infrastructure.

Sustainability and World-Leading Energy Efficiency

Energy efficiency and sustainability are increasingly in the spotlight, and typical enterprise
datacenters are far from class leading in this regard. Enterprise datacenters are often built on
compromised sites that are located within, or very close to, existing company facilities, and this
can compromise available options. They are often designed and built using in-house expertise.
Securing additional budget for longer-term efficiency savings is also challenging. IDC research2
shows the typical enterprise datacenter PUE varies between 2 to 2.5. This means that there is a
large operational overhead just to run the IT infrastructure, with more energy consumed on

 
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maintaining and cooling the IT infrastructure than is used to perform useful computational work.
Best-in-class datacenters from leading cloud and datacenter service providers are much more
efficient than this, with typical PUEs in the range of 1.05 to 1.3, meaning that only around 5% to
30% extra energy is required to support useful computation work.

In addition to raw efficiency, datacenter service providers also have the market power to drive
investment and change from utility providers to move toward more ecologically friendly sources
of renewable and sustainable power including solar, wind, and hydroelectric. In addition, with
their large campuses, these providers can also augment their energy sources with their own
power generating infrastructure installed onsite — usually solar and wind installations.

All of this world-class design, efficiency, and sustainability is made achievable only by sharing the
required investment and skills across many different customers, which very few companies
would be able to afford on their own.

Specialized Skills and Services with Enhanced Security

Beyond the marked improvement in physical facilities, leading datacenter providers also offer
additional services and skills that are hard to replicate for self-owned and -operated datacenters.
These managed services include security, virtualization, IaaS, and managed cloud, as well as
optimized interconnections to public cloud service providers, and are particularly well received
and value added.

Beyond the IT services and skills, leading datacenter providers offer a rigorous set of tried and
tested physical security capabilities such as:

 Prebooked appointments with verification of access

 Proof of identity on arrival
 Secure facility entry through mantraps
 Visitor escorts during visits
 RFID location tracking and CCTV coverage
 Biometric or multifactor authentication to access relevant data halls or rooms
 Caged racks with locks to restrict access to physical infrastructure
 Logged and audited access and activities

IDC research shows that few companies implement all of these to protect their own IT
infrastructure and tend to do so to differing levels. Having a consistent and high level of physical
security capabilities makes colocated IT infrastructure very secure.

Optimized Connectivity for Hybrid Cloud

IDC research1 shows that over four-fifths of organizations have adopted some level of hybrid IT
architecture. Integrating on-premises IT with a range of public cloud services effectively requires
enhanced connectivity to the various cloud service providers that a company accesses. For many
organizations with their own datacenter facility, it can be challenging to organize optimized
network connectivity across these many cloud services.

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Datacenter facilities providers specialize in connectivity, typically offering a choice of carrier

neutral communications services, enabling companies to choose from a range of providers that
best suit their needs. Leading providers also have dedicated public cloud connections, enabling
optimized access to the cloud provider's own backhaul networks for enhanced bandwidth, lower
latency, better predictability, and increased security. This tends to be a very popular option, with
IDC research showing that 58% of colocation customers make use of cloud interconnect services
to augment their hybrid cloud architectures.

In addition, there is a growing trend for cloud service providers to be co-resident in a datacenter
facilities provider campus, enabling customers with their IT infrastructure onsite access to
extremely high performance and low latency for the most demanding hybrid cloud applications.

Colocation Supports the Deployment of Edge Aggregation Solutions

Investment in edge infrastructure and solutions is growing strongly and using datacenter
facilities providers to deploy infrastructure close to where data is generated for local processing
can be a compelling solution compared with having to upgrade (or even source or build) satellite
facilities to the required standard to house the edge aggregation infrastructure.

Public Cloud Providers Can Use Third-Party Datacenters to Rapidly Respond to

Regional Variation
Although cloud providers typically have the global reach and scale that means they can afford to
build and operate a network of datacenters to world leading standards, they can still benefit
from partnering with datacenter service providers in a number of ways.

Datacenters typically take many years from initiation to operation, with many steps along the
way such as site identification, acquisition, planning, permits, construction, and buildout. Rapid
market changes may swing demand in different countries or regions compared with existing
plans and strategy, and a rapid response may be necessary. In this case, taking 24 to 36 months
to build out new capacity is not feasible and deploying cloud infrastructure to a datacenter
service provider is a great way to deploy capacity quickly.

Choosing the Right Datacenter Facilities Provider

Just as with IT infrastructure and cloud services, not all datacenter facilities providers are equal.
Some are focused on providing the lowest cost of power, space, and cooling. Others are focused
on additional value-added services that help drive your IT forward. To ensure any potential
candidates meet your current and future needs, you should objectively evaluate each according
to your own specific criteria such as price, footprint, connectivity, and security, as well as future
strategy, investment, and growth plans to ensure that you don't outgrow the provider and have
to consider a migration later on.

 
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Considering NTT Global Data Centers

NTT Global Data Centers is part of the new NTT Ltd., which in 2019 brought together over 30
different operating companies across the globe under a single NTT brand with a common focus
and strategy to provide customers with a comprehensive set of ICT services.

The company offers enterprises, global MNCs, and cloud providers a true "full-stack" offering
that spans design, consulting, and systems integration to hybrid IT management and global
software-defined networking and interconnection. NTT is also known as a provider of high-
quality services and offers a forward-looking road map to enable enterprises to leverage a varied
range of expertise and cutting-edge facilities. NTT offers a range of services beyond pure power,
space, and cooling to get the best out of your IT infrastructure, including:

 Networking and cloud infrastructure services

 Collaboration and productivity applications and services
 Consulting and professional services, managed services, and technology infrastructure
services

NTT Global Data Centers is the result of a significant investment and acquisition strategy by NTT
Ltd., bringing together six leading regional datacenter providers to create the Global Data Center
platform. This took a number of years of investment to consolidate the services, capabilities, and
management for a consistent customer experience which is now available under the NTT Global
Data Centers brand. In addition, the company plans to spend over $7 billion on building new
datacenter capacity in key markets.

It has a large global datacenter footprint, with around 160 datacenter locations in over 20
countries and regions, making it one of the top 3 global datacenter facilities service providers.
The company has over 500,000 square meters (over 5.4 million square feet) of floor space under
management and offers a diverse range of compute, IT, and network services to both hyperscale
companies and enterprises. NTT Global Data Centers also provides enhanced IT capabilities to
enterprises including managed hosting, colocation, hybrid cloud services, and network services.

NTT Global Data Centers facilities are carrier neutral and provide rich metro, national, and
international connectivity to customers. For customers that choose it, the datacenters are part of
NTT Ltd.'s network and are strategically located to meet the specific connectivity needs of various
finance, media, and start-up economies. The datacenters are connected via high fiber count and
DWDM-network to major carrier hubs across the globe, with major internet exchange points
across Asia/Pacific (India, China, Malaysia, Thailand, Indonesia, and Japan); EMEA (Germany, the
U.K., the Netherlands, Austria, and Switzerland); and in multiple states across the U.S. (Virginia,
Texas, California, Oregon, and Illinois).

NTT's software-defined interconnect exchange offers colocation and cloud access to public cloud
providers. This includes SD-WAN and L2 connectivity to network providers and IaaS providers.
NTT Global Data Centers, in conjunction with NTT Ltd., has invested heavily in its network
backbone, with intercontinental submarine cables and internet tier 1 backbone spanning 44

 
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metro markets globally. NTT Global Data Centers also has a dedicated telecommunications
network.

The company's new datacenters deliver a very competitive standard of 1.2 PUE for world-class
efficiency and low power draw and costs. NTT also has an ongoing commitment to drive
increasing sustainability across all global regions. Campuses in London and Hillsboro (the U.S.)
are already based on 100% renewable energy sources, with other regions following closely
behind. Datacenters across India, Malaysia, and Japan all use renewable energy sources for more
than 60% of their needs, with the Mumbai campus creating 87% of the energy it uses through
solar power.

Challenges
A key challenge for NTT as it moves forward is around branding and marketing. The company
has a stellar reputation as a hyperscale datacenter provider. While it is well known in Japan and
the Asia/Pacific region for its retail enterprise portfolio, it still lags behind in this segment in
Europe and North America. NTT will also benefit in time from the transformation and
consolidation of the various NTT divisions and subsidiaries.

NTT Global Data Centers faces a race to scale to keep competing with Digital Realty following its
acquisition of InterXion, as well as market leader Equinix, which continues to invest in new
datacenter capacity.

Another challenge for NTT Global Data Centers is the perception of being preferentially linked to
NTT Communications, a sister company within the NTT Group, rather than being carrier neutral.
NTT Global Data Centers will need to actively promote and partner with the ecosystem of over
700 networking and communications service providers to avoid this perception of bias.

Conclusion
Digital transformation is accelerating as companies look to become more flexible and agile in a
fast-changing world where connecting to suppliers, employees, partners, and customers is
rapidly transitioning to digital channels. If you are struggling to deliver the IT services your
business is demanding, migrating your IT infrastructure to world-class, highly interconnected
datacenters from leading datacenter facilities providers can help you to rapidly improve your IT
service delivery and cope with major changes in employee working behavior, keep coordinated
with your supply chains, and ensure that customer-facing services are reliable and responsive.

References
1. IDC 2020 European Enterprise Infrastructure and Multicloud Survey, n = 1,187
2. IDC 2020 Data center Operational Survey, n = 349

 
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 A Global Platform for a Secure, Connected, and Sustainable Digital Future

MESSAGE FROM THE SPONSOR 

About Global Data Centers and NTT Ltd. 
Global Data Centers is a division of NTT Ltd. Our global platform is one of the largest in the world. NTT is ranked 
as one of the top three leaders worldwide by IDC in the Colocation and Interconnection Services MarketScape, 
spanning more than 20 countries and regions including North America, Europe, Africa, India, and Asia/Pacific. As a 
neutral operator, we offer access to multiple cloud providers, a large variety of internet exchanges and 
telecommunication network providers including our own IPv6 compliant, tier 1 global IP network. Our clients 
benefit from tailored infrastructure and experience consistent best practices in design and operations across all 
of our reliable, scalable, and customizable datacenters. NTT Ltd. is a leading, global technology services company. 
Working with organizations around the world, we achieve business outcomes through intelligent technology 
solutions. For us, intelligent means data driven, connected, digital, and secure. Our global assets and integrated 
ICT stack capabilities provide unique offerings in cloud‐enabling networking, hybrid cloud, datacenters, digital 
transformation, client experience, workplace, and cybersecurity. As a global ICT provider, we employ more than 
40,000 people in a diverse and dynamic workplace that spans 57 countries, trading in 73 countries, and delivering 
services in over 200 countries and regions. Together we enable the connected future. 
https://datacenter.hello.global.ntt/en

About the Analyst

Andrew Buss, Research Director, European Enterprise Infrastructure, IDC

Andrew Buss is responsible for driving IDC's research covering present and
future trends impacting servers, storage and networking, and IT service delivery.
His research area focuses on understanding the convergence of different
technologies and capabilities and how they need to integrate and work together
to deliver efficient, effective, and agile IT services from the datacenter or cloud
right through to the end user.

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About IDC
International Data Corporation (IDC) is the premier global provider of market intelligence,
advisory services, and events for the information technology, telecommunications, and
consumer technology markets. IDC helps IT professionals, business executives, and the
investment community make fact-based decisions on technology purchases and business
strategy. More than 1,100 IDC analysts provide global, regional, and local expertise on
technology and industry opportunities and trends in over 110 countries worldwide. For 50 years,
IDC has provided strategic insights to help our clients achieve their key business objectives. IDC
is a subsidiary of IDG, the world's leading technology media, research, and events company.

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