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Digital Realty Targets Equinix With Service Exchange

Data center player jumps into booming market for hybrid cloud connections with what it believes is a better exchange.

September 22, 2016

4 Min Read
Digital Realty Targets Equinix With Service Exchange

Data center operator and colocation provider Digital Realty today announced its new global interconnection service to enable easy hybrid cloud connections for enterprises, a move that takes direct aim against primary rival Equinix.

In announcing Service Exchange, Digital Realty Trust Inc. says it intends to go beyond just connections to cloud service providers to include virtual services such as security and more, being delivered through a global platform and managed by a single service portal. By leveraging a partnership with Megaport , Digital Reality is also claiming the largest global footprint for its exchange service and the ability to let customers scale from a single cabinet up to multi-megawatts of compute capacity and storage.

In addition, Digital Realty is offering what it calls "super low-latency connections" to the cloud service provider facilities housed on its campuses, along with the ability to turn up and tear down connections on demand, as needed.

All of that adds up to a unique offering that other cloud exchanges -- and the most popular is the Equinix Inc. (Nasdaq: EQIX) Cloud Exchange -- can't offer, insists John Schultz, senior vice president of product management/development for Digital Realty. He says the scalability up to multi-megawatts and the footprint achieved through the partnership with MegaPath are particular advantages.

"If an enterprise wants to go buy from us, instead of being limited, like Equinix data centers to their Cloud Exchanges, the enterprise can actually select a Service Exchange solution globally across multiple data center providers," he says.

Customers buy a port and that can support multiple connections or virtual cross-connects which can be managed, along with bandwidth, through the Digital Realty MarketplacePortal. Customers then pay only for what they use and can turn up and tear down connections in real time, Schultz says.

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Service Exchange is built on Megaport's underlying SDN-based platform, through its API, and is available at eight Digital Realty markets in the US beginning in November, and ultimately in 90-plus global sites, including both Digital Realty data centers and Megaport locations, although some of those don't come online until 2017.

"Megaport affords us the largest footprint in the industry, with over 90 place locations in our data center and in others," Schultz says. Enterprises can buy the service from Digital Realty or from Megaport.

For network service providers that want to support hybrid cloud connections for enterprises, but don't have their own platforms for doing that, Digital Realty is offering them direct access to Service Exchange as well.

"We want to allow network providers to connect directly into the service exchange so they can tether in their customers into the exchange," Schultz says. "So they can differentiate their network products, this gives them the ability to offer hybrid cloud solutions and private cloud connectivity to their customers.

The private connection piece is increasingly critical to enterprises who don’t want their corporate data traversing the public Internet in route to public cloud providers such as Amazon Web Services or Google, Shultz says. What cloud exchanges generally offer is a way to more easily manage multiple cloud connections including a range of public clouds as well as private clouds, or colocated infrastructure.

Digital Realty, which took a major leap into the colocation space with its acquisition of Telx, operates 150 data center properties in more than 33 metro areas, scattered around the US, Europe and Asia-Pacific. Schultz says many of the major cloud service providers are already housed on those campuses. Announced customers include IBM Softlayer, AT&T, Rackspace, CenturyLink, LinkedIn, Facebook, Zayo and even Equinix.

One of the advantages the company is touting for Service Exchange is the ability to offer very low latency connections to the clouds on its campus, versus having to tether its exchange to their separate data centers, something Schultz says its competitors must do.

Of course, the Equinix footprint isn't all that shabby -- it has 146 data center assets over 40 markets in 21 countries -- also including some of the major cloud players. (See Equinix Says It's All About the Network.)

But the growing competition to enable hybrid clouds just shows how rapidly this approach to doing business has ramped up. Schultz says its customers have as many as 12 different clouds to which they connect, and the average enterprise customer has six.

— Carol Wilson, Editor-at-Large, Light Reading

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