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  1. #1
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    Has Equinix Taken a Turn For The Worse?

    I am curious to know if anyone else who buys direct from Equinix has noticed a serious turn for the worse since they have acquired Switch and Data? If you buy from a colo provider within Equinix, you may not have noticed, but if you buy direct, please let me know if you have seen their rates and customer service levels go down the tube.

    Our cabinet pricing has jumped to 73% higher than what we were originally paying last year around the same time frame. I'm wondering if this marriage between them and Carpathia is the beginning of them no longer catering to other Colocation companies and only wanting to get in bed with the Fed.

  2. #2
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    We have been in multiple Equinix data centers since 2004.

    IMHO the Equinix Operations teams are some of the best. They consistently have well trained staff that have detailed policies and procedures manuals, and they follow them. Great HVAC and power, decent security.

    The Equinix Sales team has gone straight downhill. It wasnt much of a fall. The sales team is incompetent, non-responsive, unable to provide basic quotes on any product in any facility in a timely manner.
    So far this year we have opened POPs in 5 different data centers. NONE of them have been in Equinix as our 'sales rep' has not provided a single quote in the last 4 months!
    It aint that hard. You have commodity products: cabinets, power, and cross-connects. Look up the price and send the quote for crying out loud!
    Nope, I get all types of excuses from the Equinix 'sales rep': we are doing training, corporate functions, etc. And the one that drives me nuts: meeting with customers. Uh, what are we, chopped liver?
    So when you ask if Equinix has taken a turn for the worse: YES.

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  4. #4
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    Quote Originally Posted by Spudstr View Post
    As mentioned in another thread, they want the enterprise customers who will pay the rates, not designed for anything else.
    At what point does the bottom fall out of that market though.... As large companies continue to virtualize more and more, infrastructure continues to shrink and servers become more energy efficient. What you are saying is the truth, but in this economy IMHO -- any client is a damn good client as long as they pay their bills.

  5. #5
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    Quote Originally Posted by Techee View Post
    We have been in multiple Equinix data centers since 2004.

    IMHO the Equinix Operations teams are some of the best. They consistently have well trained staff that have detailed policies and procedures manuals, and they follow them. Great HVAC and power, decent security.

    The Equinix Sales team has gone straight downhill. It wasnt much of a fall. The sales team is incompetent, non-responsive, unable to provide basic quotes on any product in any facility in a timely manner.
    So far this year we have opened POPs in 5 different data centers. NONE of them have been in Equinix as our 'sales rep' has not provided a single quote in the last 4 months!
    It aint that hard. You have commodity products: cabinets, power, and cross-connects. Look up the price and send the quote for crying out loud!
    Nope, I get all types of excuses from the Equinix 'sales rep': we are doing training, corporate functions, etc. And the one that drives me nuts: meeting with customers. Uh, what are we, chopped liver?
    So when you ask if Equinix has taken a turn for the worse: YES.
    What's the saddest part is that Switch and Data had less security, dingier sites, and less built in redundancy, but were overall a much better company to do business with. Now all of the old Switch bills are all jacked up since being taken over by Equinix, orders are delayed, and just like you I can't get a competent sales rep who knows how to quote or frankly could care less that we spend $50k a month with them.

    I'd put them right at the bottom of the barrel when it comes to caring about their clients, maybe slightly above Verizon.

  6. #6
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    Quote Originally Posted by colosolutionz View Post
    At what point does the bottom fall out of that market though.... As large companies continue to virtualize more and more, infrastructure continues to shrink and servers become more energy efficient. What you are saying is the truth, but in this economy IMHO -- any client is a damn good client as long as they pay their bills.
    Nothing is consolidating. The move to the "cloud" is pushing more and more data center demand, moving everything from offices, desktops, etc. to the data center. Equinix isn't starving for business, they'll take a loss for a couple months to make it up on the margin they'll get from the multi-year lifespan of higher paying clients.
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  7. #7
    also a rule of demand is that when something becomes cheaper, people use more of it. If you can host more on fewer servers, the end result is actually more total servers being used, because each of those servers is more valuable for less money. Applications that used to be too expensive start to make sense. Remember when youtube was a huge money pit? Now everyone wishes they had as much of this "worthless" traffic as they can get. That's more of a bandwidth cost story, but the same is true of servers in general. As long as we can figure out how to get more compute per dollar, people will find more ways to use servers.
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  8. #8
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    Equinix isn't starving for business, they'll take a loss for a couple months to make it up on the margin they'll get from the multi-year lifespan of higher paying clients
    One wonders the reaction of the Equinix institutional investors when they learn that Equinix sales reps are infuriating their customers that are doing $300,0000 to $600,000 per year?
    In this economy it is difficult to imagine any Company turning away customers but that is what Equinix is basically doing.

  9. #9
    Quote Originally Posted by Techee View Post
    One wonders the reaction of the Equinix institutional investors when they learn that Equinix sales reps are infuriating their customers that are doing $300,0000 to $600,000 per year?
    In this economy it is difficult to imagine any Company turning away customers but that is what Equinix is basically doing.
    sounds like a good opportunity for an episode of undercover boss. to new hire: "oh don't worry, that's just a sales inquiry from a large existing customer, I'll get them off the phone"
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  10. #10
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    Quote Originally Posted by Techee View Post
    One wonders the reaction of the Equinix institutional investors when they learn that Equinix sales reps are infuriating their customers that are doing $300,0000 to $600,000 per year?
    In this economy it is difficult to imagine any Company turning away customers but that is what Equinix is basically doing.
    To put it in perspective though, that is ~0.04% of their revenue, no investor is going to notice that kind of change especially for a company with 30%+ annual revenue growth (latest numbers show ~43%). They're growing that fast from multi-million dollar deals. Also, depending on your deal/rates with them, maybe they can replace you with a bigger name or higher paying customer anyway?

    Not saying that is the right way to do business, but when you work with companies this big, that is the stuff that matters. We dealt with the same sort of thing with Equinix ourselves, but it didn't surprise me and I moved on. That is the type of environment/company you chose to work with and I fail to see why so many small/medium businesses still choose to work with Equinix and TelX, etc. when there are other options that will actually care about their business and not just see them as numbers.
    Last edited by KarlZimmer; 04-09-2011 at 04:50 PM.
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  11. #11
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    Quote Originally Posted by funkywizard View Post
    Remember when youtube was a huge money pit? Now everyone wishes they had as much of this "worthless" traffic as they can get.
    Reuters, Fri Mar 4, 2011 9:39pm EST

    Schmidt said Google was not too anxious to see YouTube showing a profit, defending the scale of investments in its online video site.

    "Profitability is not that important for us. For YouTube, what's really important is to build the great business for the partners," he said, adding that YouTube remained "almost profitable."
    http://www.reuters.com/article/2011/...72409Y20110305
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  12. #12
    Quote Originally Posted by dotHostel View Post
    Reuters, Fri Mar 4, 2011 9:39pm EST



    http://www.reuters.com/article/2011/...72409Y20110305
    Although youtube may be "almost profitable" with the way they've monetized it, I can tell you it could be making a lot more money tomorrow if they tried. It also helps that google gets b/w for youtube for next to nothing. When most people in Turkey were using my website to get to youtube, that was making plenty of money, even though Turkish ads are hardly very high CPM, and even though my cost of b/w is much higher than google pays for it. I can only imagine how much money it would make if google were aggressive at monetizing their visitors from US and Western Europe. Obviously they're taking the long view on this one, trading a few dollars today for dominance tomorrow, but any other video site with that kind of traffic would be making absolutely obscene amounts of money. And when they started on it, even with aggressive monetization, it would have been extremely difficult to break even, simply because b/w was so much more expensive back then. Now that b/w prices have dropped, video traffic has exploded everywhere.
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  13. #13
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    Equinix is a RETAIL data center, not WHOLESALE

    Karl's comments are right on, and I would add that Equinix stopped being a location for reselling many moons ago. Their average client is about 20 cabs or under 80 KW, and they are primarily end users, not resellers. Internap, IBM, and others still resell out of Equinix, but their margins have been under pressure for years.

    What's most fascinating is that there have been MANY alternatives for a long time, and yet, few are willing to change. Why is it that Equinix charges twice the market, there are MANY alternatives, and according to the above, their sales people aren't great, and yet, there's still very little competition or price pressure.

    IMHO, when it comes down to it, few are capable of assessing the real risk of moving or using an alternative. Ultimately, Equinix wins because they are perceived as a safe haven.

    I applaud Karl and Steadfast who have made the leap to those alternatives, and I encourage the rest of you to do the same and vote with your dollars.

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  14. #14
    What's interesting is that, despite charging well above market rates, and having a lock on some very desireable IX / cross connect business, their net and gross margins are much lower than you would assume:

    http://finance.yahoo.com/q/ks?s=EQIX+Key+Statistics

    Revenue (ttm): 1.22B
    Net Income Avl to Common (ttm): 36.88M
    Profit Margin (ttm): 3.02%
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  15. #15
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    Equinix wins because they are perceived as a safe haven.
    Equinix wins because they have excellent peering, and multiple carriers that can reliably provide 10 gig ports.
    We moved from Switch and Data SJC to Equinix a couple years ago for bandwidth availability. At the time, S&D had NO carriers that provided 10 gig ports.
    Many of the 'me-too' data centers have a few carriers, that are connected on the same fiber loop. There is another post here about a Telx facility with only 2 fiber entries!
    Yes, there are 'many' alternatives. Frightenly, some actually still have DS3 connectivity, others dont know how to spell generator or UPS maintenance, etc.

  16. #16
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    You dont need to have all your stuff in Equinix to avail of the peering and carriers.
    All you need is a router in a half rack or less.

  17. #17
    Quote Originally Posted by Techee View Post
    Equinix wins because they have excellent peering, and multiple carriers that can reliably provide 10 gig ports.
    We moved from Switch and Data SJC to Equinix a couple years ago for bandwidth availability. At the time, S&D had NO carriers that provided 10 gig ports.
    Many of the 'me-too' data centers have a few carriers, that are connected on the same fiber loop. There is another post here about a Telx facility with only 2 fiber entries!
    Yes, there are 'many' alternatives. Frightenly, some actually still have DS3 connectivity, others dont know how to spell generator or UPS maintenance, etc.
    I would be surprised if you couldn't get backhaul into a facility with 10g or higher ports from whichever datacenter you decide to go with, even if the carriers on-net in that facility don't provide it directly. If equinix is really charging twice as much for rackspace, power, etc, that easily pays for a backhaul and cross connect from a cheaper facility to a facility with the bandwidth options you're looking for.
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  18. #18
    You dont need to have all your stuff in Equinix to avail of the peering and carriers.
    All you need is a router in a half rack or less.
    This is what we do. This way we can have access to all the carriers and peering. We can also offer any colo customers access to the complete list of bandwidth providers in Equinix.
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  19. #19
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    If your 'non equinix' colo supports it, you can lease waves straight to Equinix and avoid hardware/colo inside Equinix altogether. Plus you don't have 3rd party routers in the mix (such as your colo trunking everything through their own network, ect), less stuff to go wrong ect ect.
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  20. #20
    If your 'non equinix' colo supports it, you can lease waves straight to Equinix and avoid hardware/colo inside Equinix altogether. Plus you don't have 3rd party routers in the mix (such as your colo trunking everything through their own network, ect), less stuff to go wrong ect ect.
    With a wave you would still have third party hardware in place. Unless you are leasing the dark fiber and lighting it yourself, which is what we do. The truth is if you have a data center and all the expense that goes with it then the minimal cost to have some gear in equinix shouldn't be an issue. Yes, we could offer clients wave service back to equinix but most don't have that kind of requirement. A virtual cross connect is more than enough for them.
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  21. #21
    The part I still find interesting that nobody else is talking about here, is that Equinix charges much more than many other providers, while offering roughly equivalent services, as well as making a cash cow on cross connects, and still barely squeaks by with single digit profit margins and negative free cash flow. The negative cash flow can be explained by expansion, but the terrible net income figures are a mystery to me. Is equinix offering a service that costs *that much more* to provide than every other colo company out there, or is *every other colo* losing tons of money, or is equinix an extremely poorly run company that happened to become a "top dog" despite abysmal return on investment?
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  22. #22
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    Quote Originally Posted by funkywizard View Post
    The part I still find interesting that nobody else is talking about here, is that Equinix charges much more than many other providers, while offering roughly equivalent services, as well as making a cash cow on cross connects, and still barely squeaks by with single digit profit margins and negative free cash flow. The negative cash flow can be explained by expansion, but the terrible net income figures are a mystery to me. Is equinix offering a service that costs *that much more* to provide than every other colo company out there, or is *every other colo* losing tons of money, or is equinix an extremely poorly run company that happened to become a "top dog" despite abysmal return on investment?
    Its not cheap to buy people like.. Switch & Data and to build datacenters world wide non-stop. They are a public company with large investors. Look at global crossing, level3 and cogent etc. None of them afik are profitable.

    How can you not see horrible net income after seeing negative cash flow? Gotta get from Point a to point b somehow.

  23. #23
    Quote Originally Posted by Spudstr View Post
    Its not cheap to buy people like.. Switch & Data and to build datacenters world wide non-stop. They are a public company with large investors. Look at global crossing, level3 and cogent etc. None of them afik are profitable.

    How can you not see horrible net income after seeing negative cash flow? Gotta get from Point a to point b somehow.
    Ah, but the main part is, all of those expansion expenses are amortized over the expected useful life of the facility. The expense of buying a company is put on the books as an asset, part of it as the real value of the assets acquired, which are depreciated over their useful life, and the remainder as "goodwill" that doesn't have to be depreciated. So it doesn't affect the net income figure, only the free cash flow figure.

    An expanding company, yes, I wouldn't be surprised by negative free cash flow. But if they can amortize the datacenter facility over 30 years, amortize the HVAC over 15 years, amortize any network gear over 5 years, servers over 3 years, etc etc etc, and *still* can barely eek out being "profitable" on paper, despite charging twice the price of other well run, quality facilities, how does that add up? We're not talking about the Cogents of the world here, this is as if Apple were less profitable than Dell or HP on a per-unit-sold basis, despite charging 50% more for the same thing.
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  24. #24
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    Quote Originally Posted by funkywizard View Post
    Ah, but the main part is, all of those expansion expenses are amortized over the expected useful life of the facility. The expense of buying a company is put on the books as an asset
    A lot of companies are bought at a multiple of their true value. Usually this has a strategic value but it does not look good on the books.

    Quote Originally Posted by funkywizard View Post
    An expanding company, yes, I wouldn't be surprised by negative free cash flow. But if they can amortize the datacenter facility over 30 years, amortize the HVAC over 15 years <snip>
    You amortization is all wrong, HVAC for example needs to replaced faster then this, for many obvious reason.
    But besides this and far more important: in your sum up you totally forget the two most important drains on cash in a company! and you also seem to miss that it cost money to provide more value then -the competitor-
    The two factors you missed in you summing up the costs are very common missed by a starter / small business
    What two factors could i be talking about?
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  25. #25
    Quote Originally Posted by swiftnoc View Post
    A lot of companies are bought at a multiple of their true value. Usually this has a strategic value.
    Right. The point is that strategic value is counted as an asset, and does not negate their net income reported. It is accounted for as a "good will" asset. Therefore, they can spend whatever they want on acquisitions and it shouldn't make them "unprofitable" on paper, although it will affect their cash flow.

    Quote Originally Posted by swiftnoc View Post
    You amortization is all wrong,
    They're just examples. Once the equipment becomes worthless, it's worthless. If you can't get the value out of the equipment before you have to throw it away, you've lost money. If your yearly revenue related to a piece of equipment is greater than the rate at which it loses value, you've earned a net income even if you don't have any cash. The expense reported on their income statement is related to the cost of the depreciation, i.e., the speed that the asset is losing value. the net income is not hurt if the asset maintains value and it cost a lot to buy it.

    Quote Originally Posted by swiftnoc View Post
    totally forget the two most important drains on cash in a company!
    Which are?

    Quote Originally Posted by swiftnoc View Post
    and you also seem to miss that it cost money to provide more value then -the competitor-
    The two factors you missed in you summing up the costs are very common missed by a starter / small business
    What two factors could i be talking about?
    Advertising and Labor?

    Ok, I could buy that the CEOs at the top are taking in way more money than they deserve and completely screwing the shareholders. But every other part of the business is going to have the same kind of constraints as any other colo company.

    Does swiftway not need to advertise, build it's brand, pay it's employees, provider customer service? Doesn't steadfast, or yellowfiber, or hostdime, or phoenixnap, or any of these other much more affordably priced providers have to do the same thing?

    If everyone in the market were charging what equinix charged, I could buy the net profit margin being that low, because that would just be the cost of doing business.

    With everyone operating under the same parameters, and with other businesses that have the same types of expenses, and being able to profitably offer a similar quality service at a much lower price, I find it hard to believe that equinix is well run, when they have 1) overwhemling demand, 2) extremely high prices, 3) remote hands that are frequently referred to on this forum as "average or worse, at an extremely high price", 4) sales people that can barely get back to you. Obviously the money isn't being spent on remote hands, it's not being spent on sales people, all the equipment is going to be basically the same as any other similar quality facility, they only have to count as expenses the decline in the value of their assets, rather than their purchase costs, so what happened to the net income?
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  26. #26
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    Quote Originally Posted by swiftnoc View Post
    The two factors you missed in you summing up the costs are very common missed by a starter / small business
    What two factors could i be talking about?
    I guess one of them is the cost to acquire new customers. The other maybe the money´s cost.
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  27. #27
    Quote Originally Posted by dotHostel View Post
    I guess one of them is the cost to acquire new customers.
    A cost every colo provider has.

    What cost does equinix have that nobody else has? Are they spending twice as much on their facilities per amp of power or per U of rackspace? Are they spending twice as much on labor per billable hour? Are they spending twice as much on their sales force per $ of revenue brought in the door? I suppose any of these are possible, but they seem unlikely to me.
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  28. #28
    Quote Originally Posted by dotHostel View Post
    The other maybe the money´s cost.
    Very true, but a cost every business has as well. As a large established company, I would think that Equinix has better access to capital at lower interest rates than a small competitor such as a non-publicly-traded company. So I would expect that cost to be a lower percent of total costs, not a higher portion, than for a smaller company with a similar debt to equity ratio.
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  29. #29
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    Some Interesting views in here, to be quite honest, I am keeping an eye on the topic,

    Oh, and funkywizard please quit double posting.

    @dotHostel there is such thing as an edit button no?
    Last edited by Interix; 04-13-2011 at 07:56 PM.

  30. #30
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    Quote Originally Posted by Interix View Post
    Oh, and funkywizard please quit double posting.
    Not funkywizard´s fault. I did edit my post adding a second cost.
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  31. #31
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    Quote Originally Posted by funkywizard View Post
    With everyone operating under the same parameters, and with other businesses that have the same types of expenses, and being able to profitably offer a similar quality service at a much lower price, I find it hard to believe that equinix is well run
    There are important aspects that you miss. HR is indeed usually the largest cost, unless the provider in question is a one man show / very small operation.
    But the larger an organisation gets, the more overhead comes into play in HR. Think about:

    - Management layers
    - People that are employed, but are not productive towards to actual service (cleaners, janitors, internal support, internal ICT team for office network etc).
    - Departments that simply do not exist in smaller business

    Larger organisations have more office and datacenter locations, so add travel costs and various overhead....
    To come back at Humar Resources: no everyone has the same costs. Location/Country is a factor, education level is a factor, experience is a factor. Some providers have a relative young, low educated and inexperienced staff, while others have experienced, highly educated people on the payroll. The customer does notice the difference, but some simply need a budget provider while others look for a business provider.
    Different business models have different costs.
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  32. #32
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    "The two factors you missed in you summing up the costs are very common missed by a starter / small business
    What two factors could i be talking about?"

    Hardly HR is a cost missed by a startup/small business and in capital intensive business as data centers HR expenditures are not that significant.

    At a conference in Las Vegas last week, Michael Manos, Microsoft's senior director of data center services, said in a keynote speech that the first floor of a data center being built by the software vendor in the Chicago area will hold up to 220 shipping containers, each preconfigured to support between 1,000 and 2,000 servers, according to various news reports and blog posts.

    That means the $500 million, 550,000-square-foot facility in the Chicago suburb of Northlake, Ill., could have as many as 440,000 servers on the first floor alone — or up to 11 times more than the total of 40,000 to 80,000 servers that conventional data centers of the same size typically can hold, according to Manos. He was quoted as saying that Microsoft also plans to install an undisclosed number of servers on the building's second floor, which will have a traditional raised-floor layout.

    Despite its huge size and 24-by-7 operations, Microsoft's Northlake data center won't provide much of a lift to the IT job market in the Chicago area. Manos has said that the new facility would employ only about 30 people, including systems administrators as well as building security and janitorial staffers.

    http://www.computerworld.com/s/artic...ed_data_center
    Last edited by dotHostel; 04-14-2011 at 07:39 AM.
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    Thats MICROSOFT, NOT A HOSTING PROVIDER!
    I really hate the know it alls on this board who actually have no experience with anything and people leave off believing what they read.

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    Thumbs down

    Quote Originally Posted by CGotzmann View Post
    I really hate the know it alls on this board who actually have no experience with anything and people leave off believing what they read.
    Fortunately for this board very few members have the kind of experience you have.
    You will only find out how good a provider is when the going gets tough

  35. #35
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    Aug 2008
    Posts
    133
    In order to bring this thread back on topic I'd like to relay a conversation I had this afternoon with an Equinix sales rep. He called me to find out how our data center search was going after I had taken a tour of SV5 at 9 Great Oaks, San Jose back in February. I let him know we were working with a number of VARs trying to source hardware for our edge routing and looking towards a final design in the near future. We also discussed our bandwidth requirements and the fact that we'd been considering Global Crossing. I asked him about the Level 3 news and what effect that might have on a pending quote with GBLX.

    After that he asked if there was anything he could do to help us make our decision and I let him know our CTO was concerned about the increased demand he'd perceived for commercial space in the valley over the past few months. The Equinix rep followed up via email with me and let me know he would contact the Space Engineering Team to get a sense of how things were looking at 9 Great Oaks.

    In all, I'd say the sales rep was very helpful and professional. I suppose getting plugged into the right people at any large company can be a hurdle to overcome. We're also a rather small potential customer for Equinix with our 5 rack private cage spec and outstanding quote.

  36. #36
    Join Date
    Jun 2009
    Location
    Las Vegas, NV
    Posts
    101
    Most of what is being discussed via this forum isn't subjective, aside from the sales issue.

    Yes, there are MANY alternatives to Equinix that offer 10G bandwidth service from multiple providers. We see them in every market, and the TCO is half or less than Equinix. The AVEARAGE cost of an Equinix rack is a public figure of more than $700 / KW, which means $2,800 for a 4kw rack (2x20A approx). You may start at less, but you are heading north at your first renewal. Again, the above is not subjective...Equinix reports their average per rack revenue quarterly.

    The original reasons for being at an Equinix site have diminished demonstrably, because metro and national network costs have dropped so dramatically, but the market hasn't become aware of it. This isn't a subjective or opinion based thing. If you do the work, you will be able to find the same thing.

    For example, the Great Oakes expansion aside, the majority of the "data center" sites of Equinix today trunk back to their core "exchange" centers, which means the "metro-interconnection" architecture described above is one that Equinix themselves implement.

    IMHO, Equinix is a very well run company with few exceptions. Their sales people are well trained, mature, and long tenured. They are by far the most sophisticated of the colo operators. Financially where they fall down is in ballooning SG&A and the differences between book accounting (GAAP) and EBITDA/Cash Flow. On a facilities basis, their gross margin is quite attractive, but on a GAAP Net Income basis, depreciation clobbers their results, as it does for all large, fixed asset businesses. Cash flow is the metric used by wall street for this industry, and of course, operating cash flow and cash flow after financing and investing are viewed separately.

    Today, truly, if you are looking for colo space with 10G access, it is possible to RELIABLY procure high-availability space comparable to Equinix at $400/kw or less, often times at $300/kw or less, in EVERY major market. We've placed clients in major Silicon Valley exchanges and elsewhere at $250/kw. You may not like hearing it, but these are facts. I'd love to hear what Steadfast are achieving in Chicago, and I'd bet is closer to $200/kw, though they have scale on their side.

    Let's say the average deal at Equinix has a term of three years. Then, let's also assume at lease one renewal at a higher rate, so over six years, let's call it $600/kw. For a 20 Cab, 4kw deployment, the total spend will be nearly $3.5 million. A half cost deployment represents a savings of $1.75 million...not chump change.

    ET
    Everett Thompson, CEO - "Largest list of data centers on the planet." Strategy, Design, Brokerage, Finance
    US Data Center List
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  37. #37
    Join Date
    Feb 2004
    Posts
    634
    Quote Originally Posted by Everett View Post
    Yes, there are MANY alternatives to Equinix that offer 10G bandwidth service from multiple providers. We see them in every market, and the TCO is half or less than Equinix. The AVEARAGE cost of an Equinix rack is a public figure of more than $700 / KW, which means $2,800 for a 4kw rack (2x20A approx). You may start at less, but you are heading north at your first renewal. Again, the above is not subjective...Equinix reports their average per rack revenue quarterly.
    That publicly reported number is not $2800, it's just above $2000 (at least for USA datacenters in 2010). My understanding is that for this calculation they are essentially taking their entire revenue and dividing by the number of cabinets under lease, so it's also including things like power, cross connects, exchange ports, managed services, etc. If you read the comments from Equinix's CFO when the quarterly numbers come out, the increase in revenue per cabinet has largely been attributed to increased utilization of these other services by their existing customers (especially 10G exchange ports, which I seem to remember reading has almost doubled since 2009).

    Maybe I'm lucky, but I regularly price Equinix in several markets throughout the year, on small to moderate sized deals, and I've never been quoted $2800 for a single cabinet with 40A. Though these are generally du novo installations and therefore in the newer facilities or campus buildings, not the older ones that are more power and capacity constrained and probably priced higher due to demand from current customers.

  38. #38
    We've been trying to reach anyone in equinix (formerly s&d) in Pittsburgh for over a week now. Trying to get a quote on a single rack.

    No emails, no callbacks, nothing.

  39. #39
    Join Date
    Jun 2009
    Location
    Las Vegas, NV
    Posts
    101
    Yes, the public figure is over $2100, which assuming approximate average power per cab of a little over 3kw per rack, that equates to $700/kw. Like I said above, new and first term deals are lower, and yes, a standard 2kw rack would be lower as well. First term deals would be closer to $2,000 to $2,400, depending on location and your deployment, for 4kw.

    Understand, these are AVERAGES, which means half of their customers are WELL OVER these figures.
    Everett Thompson, CEO - "Largest list of data centers on the planet." Strategy, Design, Brokerage, Finance
    US Data Center List
    International Data Center List

  40. #40
    Join Date
    Jan 2003
    Location
    Chicago, IL
    Posts
    6,889
    Quote Originally Posted by Everett View Post
    Yes, the public figure is over $2100, which assuming approximate average power per cab of a little over 3kw per rack, that equates to $700/kw. Like I said above, new and first term deals are lower, and yes, a standard 2kw rack would be lower as well. First term deals would be closer to $2,000 to $2,400, depending on location and your deployment, for 4kw.

    Understand, these are AVERAGES, which means half of their customers are WELL OVER these figures.
    The point still stands though, that covers ALL services, not just for the space and power. We pay over $8k for a HALF cabinet in Equinix. Now, we're paying a low and fair rate for the half cabinet and power, but then on top of that we have our Exchange port and MANY cross connects. With the number of carriers and exchanges they have I have to imagine their cross connect revenue is a substantial portion of their overall revenue.

    Note: I still feel their exchange services and on-site hands would be a minor part of revenue. They aren't making more than $2 million a year off exchange ports in Chicago, while they're probably making $6+ million a MONTH on cabinets and cross connects.
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