Which Colocation and Wholesale Data Center Operators in Greater Miami Are the Most Digitally-Savvy?

Introduction

The data center industry is changing fast and the Greater Miami market is no exception. During 2017:

  • Equinix (EQIX on NASDAQ) acquired 29 data centers in 15 markets from Verizon. In the Greater Miami market, this included Network Access Point (NAP) of the Americas in downtown Miami with 750,000 square feet of space spread out over six floors. NAP of the Americas brings together 160 network carriers and routes traffic from the Caribbean, South America, and Central America to more than 150 countries.
  • Florida very selectively eliminated sales tax and use tax to encourage wholesale data center development of 15 megawatts or larger, subject to certain requirements. To avail of the incentives, capital investment must exceed $150 million and the data center must be online by June 30, 2022. Developers will need to apply to the Florida Department of Revenue (DOR) for a temporary exemption certificate.
  • Hurricane Irma brought Category 2 wind gusts to Miami International Airport (MIA) and knocked out power for nearly two million people in Greater Miami. The region’s flagship data center facility -- NAP of the Americas -- located less than seven miles from MIA was built in 2001 to withstand a Category 5 hurricane and set at 32 feet above sea level -- came through the storm with no reported damage or power outages.
  • 365 Data Centers acquired Boca Raton-based Host.net to bolster its total footprint to include ten markets across the U.S. -- including Host.net’s data centers in Boca Raton and Fort Lauderdale.

 

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And these broader trends -- mergers and acquisitions, state incentives, and natural disasters -- are issues that most other secondary and primary data center markets across the U.S face.

But it’s not just the data center industry going through dramatic changes and challenges. The broader IT and business marketplace in Greater Miami is seeing tremendous transformation, growth, and disruption.

For example, Florida’s population is expected to grow by 6 million to 26 million by 2030 -- with a significant percentage of that growth anticipated to happen right in South Florida: In Miami-Dade, Broward, and Palm Beach counties.

Long before that happens, Greater Miami is already seeing drastic changes in buyer preferences -- regardless of whether we’re talking about influencers or decision makers.

Starting with the release of the original iPhone in 2007, the way people research and make purchase decisions changed.

Word of mouth. Cold calls. Cold emails. Interrupting people with obnoxious, self-serving advertising. Direct mail. Print advertising. All of these marketing channels that were mainstays of business development playbooks, literally for decades (1980s, 1990s, and early 2000s), have been called onto the mat. In nearly all cases, these channels have become far less effective and have gotten far more expensive.

Why? People grew tired of interruptions and proved they were willing to pay to get what they wanted (no more, no less), exactly when they wanted it, 100% on their own terms.

The empowerment rooted in search engines, social media, mobile devices, and cloud computing has fueled entirely new business models based on selective consumption of information.

People subscribe to streaming video services like Netflix and Hulu -- and use DVRs -- to avoid watching commercials. People subscribe to satellite radio providers like SiriusXM to avoid annoying radio advertising.

What many miss: all of these personal preferences that may start at home don’t just stay at home. These same influencers and decision makers, and all the other stakeholders that purchase data center-related products and services, bring these preferences into the workplace.

Ironically, the data center, mission critical, cloud services, and telecommunications industries have benefited greatly from all of this growth in demand. Yet many of those in leadership roles at outsourced data center providers have failed to appreciate how these changes impact demand generation, desired customer experience, differentiation, competitive positioning, and their ability to stave off market disruption.

Technologies like Gmail’s Priority Inbox make it tougher for any commercial email to make it into the Inbox. And do people answer their phones anymore without checking caller ID?

The rules have changed for businesses of all sizes and shapes -- including colocation and wholesale data center providers in the Greater Miami area.

Their clients and potential clients have become accustomed to -- in many cases, addicted would be the more accurate term -- using search engines, social media, and mobile devices to find answers to questions and seek out solutions to problems.

Regardless of required power, bandwidth, space, or industry-specific needs, this behavior change has completely upended the buyer’s journey -- the active research process someone goes through in between when that person begins searching for answers and when that person becomes a paying client.

In the pre-iPhone era, potential clients reached out to IT companies like colocation and wholesale data center operators for information when they were 10% to 20% of the way through their decision-making process. Those days are long, long gone.

Today, as much as 70% (or more) of their decision may be over before a potential client even reaches out to a colocation or wholesale data center provider.

This change in the decision-making process presents enormous challenges to most data center operators in Greater Miami that are stuck in the past, using the same business development, marketing, and sales playbook that they’ve used since the 1980s and 1990s.

But digital transformation also presents enormous market opportunities for digitally-savvy data center providers that can get found by the right influencers and decision makers, in the right places, at the right time, and most of all: in the right context -- to be seen as trusted advisors and educators, rather than just IT vendors.

In the Greater Miami Data Center Market Opportunity Report, we’ll explore which colocation and wholesale data center operators in the Greater Miami area are the most digitally-savvy -- and doing the best job keeping up.

We’ll unpack this challenge by looking at 49 metrics with regard to how each fares with:

  • Differentiation in the Modern Buyer’s Journey
  • Thought Leadership Strategy and Website Authority
  • Competitive Positioning
  • Company Social Media Presence
  • Lead Generation
  • Paid Search Acceleration
  • Full-Funnel Revenue Growth and Digital Infrastructure

Note: As you review the tables for each metric analyzed, for most metrics with a three column table, the strongest companies appear in the left-hand columns in the tables. The weakest companies appear in the right-hand columns in the tables. For example:

Greater Miami Data Center Market Opportunity Report - Metrics
Full Funnel Revenue Growth

Methodology

To develop the shortlist of who to research, each outsourced data center provider had to

  • Have at least one data center location in South Florida: Miami-Dade, Broward, or Palm Beach County (or within a one hour’s drive to directly compete with colocation and wholesale data center operators in Greater Miami; which given the suitability limitations of both the Florida Keys and the Everglades makes this next to impossible)
  • Be principally in the business of selling colocation and wholesale data center services (leasing space), as opposed to primarily selling website hosting, cloud services, or managed services
  • Have a functional website that displays their physical data center address(es) in Greater Miami
  • Have a LinkedIn company page that employees are attached to

We ended up with 21 data center operators that have 27 physical data centers located in the Greater Miami area --  which we believe will further contract as more mergers are announced and completed in the coming months and years.

The data centers are located in Boca Raton, Doral, Fort Lauderdale, Miami, Miami Gardens, and West Palm Beach -- with nearly 80% (17) of the data center operators having a presence in Miami.

While we don’t believe that these 21 companies represent all of the outsourced data center operators in Greater Miami that meet the criteria, we do believe that the companies included are representative of how digitally-savvy data center providers in the Greater Miami area are.

On some metrics, we offer a median or average for that metric immediately before the table that presents how each company fares relative to its competitors.

In many cases, the median number is presented to avoid skewing data due to very large company size differences between some of the smallest and largest data center providers in the region. In other cases, where a massive company size disparity shouldn’t impact more accurate comparisons, a simple average is used.

And in a few cases, the data is normalized relative to the number of employees and presented in both absolute form and on a percentage basis.

Just as a balance sheet is a snapshot in time, the data in this report was gathered during a one week period in November 2017. It’s fully expected that the outsourced data center operators within this report, and others that read this report, will make changes to their websites.

However given that a few of the companies in this report had let their websites sit stagnant for literally years, there will be some resistors who believe that their clients are different -- and don’t use search engines, social media, or smartphones.

And just to be clear: None of the data center operators in this report paid for inclusion/sponsorship. While we do know stakeholders in various roles at 7 of the 21 data center operators included in this report, none, at the time of publication, have a financial relationship with the report’s publisher: SP Home Run Inc.

 

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