Good evening, this is Cold Isle.
Data centers are where infrastructure, IOT, and telecommunications meet. We’re focused on what’s happening at that convergence.

(Also, if you’re a new subscriber, could you do me a huge favor and add me to your favorites or your contact in your email, that really helps me. Thanks you’re the best!)

Today’s Big Stories:

1. Cloud spending primed to jump: Maybe. Gartner thinks so but they also might be wrong (but they’re probably not).

2. American Tower’s got moves: What’s their plan?

3. Fresh Hot Links, finally: podcasts, cyber stuff, and the inimitable Rich Miller!

Est. read time: 5mins, 1secs

- Cloud and Colocation -

Industry researchers say cloud spending set to explode

­Research firm Gartner expects global cloud spending to reach nearly $600 billion, growing 21.7% year over year. Planning to see spend on SAAS see a slow in growth, the research points to Infrastructure as a Service growing more than 30% over the year.

1 year, 30% growth. That’s a lot.

So ok, if that’s the case, why did reporting come out last week that AWS, Google Cloud, and Azure all report a slowing in growth in Q1? How could both be true?

Good question. Gartner thinks that:

1. Emerging technologies will push acceleratingly towards an increased need for the cloud. AI, Web3, and the metaverse, all require tons of data processing and storage and are all brand new.
   The more they become a ubiquitous part of life and business, the need for supportive infrastructure becomes obvious.

2. As the digitization flywheel starts to accelerate, it becomes obvious that the cloud is still in its infancy. Over 90% of IT spend is still on-premises. Soon, to compete, that spending will have to shift to the cloud so enterprises can scale their data.

So What?

Well first, If I were trying to sell industry research reports for $5000 apiece, I’d probably predict a boom in that industry too!

With that said, it does seem like the slowdown the hyperscalers have seen across the board was a cyclical phenomenon. I think the technology that is in the midst of exploding right now is undeniably going to lead to exponential growth in cloud and colocation services.
Is it going to happen this year, I don’t know about that…

- Telecommunications -

American Tower’s recent moves highlight shift in telecom priorities

Cell tower giant American Tower has made its intentions clear over the past 2 years. First, the company purchased CoreSite Realty, one of the biggest data center operators in the US, for $10.1 billion.

Then, amid other acquisitions (like DataSite, 2021), the company announced yesterday the sale of its fiber business in Mexico to Flō Networks for $253 million. 
(The Mexican fiber optic industry wasn't quite as lucrative as they hoped.)

The transactions highlight the growing importance of data centers and the potential for expansion into edge computing by the telcos.
And buying CoreSite is American’s first big move into the future towards the convergence of wireless and wireline.

The idea is to position the company to build computing services across the core, metro edge, and mobile edge of the network.

By placing mini edge computing data centers at the base of American Tower's cell towers, the company hopes to operate data centers not only in big US cities but also in smaller cities and potentially in thousands of locations all over the country and the world.

(Not a bad gameplan)

American Tower isn't the only company moving in on data centers. KKR & Co. and Global Infrastructure Partners LLC announced too that they would purchase data center operator CyrusOne for around $15 billion.

SBA Communications has also purchased several data centers and is selling computing services under its new SBA Edge brand. DigitalBridge recently announced an expansion of its Vantage data center business in Santa Clara, California.

Meanwhile, American Tower's sale of its Mexican fiber network to Flō Networks reflects the company's efforts to improve its financial footing by selling some of its underperforming operations.

As the convergence of wireline and wireless networks accelerates amid global 5G deployments, the potential for edge computing to play a larger role in telecom

Hot Links 🌭

1. IBM is taking the exact opposite tact as Intel, leaning more on AI and Cloud as their infrastructure business stalls. Get it HERE

2. Who likes podcasts? The Topline, about biopharma and medtech is awesome. MC Mag has a good one too. Here’s an ep about in-building cell coverage.

3. Liquid Stack gets a huge investment by Trane. That’s been a fun company to watch. Read more about it.

4. Rich Miller killing it as always. Check out this AI digital twins tech.

Daily Dall-e

“I learned everything I know about data centers from reading the Cold Isle.”
- Steph Curry

I hope you learned something. We would love your feedback, and love it even more if you shared this with a friend or coworker!

- Taylor

s