Equinix will expand into security and storage services over the next several years, according to CEO Steve Smith.
The 20-year-old data center company originally made it “easy for companies to come in and connect to networks around the world, and interconnect in hours, not months,” Smith said at the Citi 2018 Global TMT West Conference yesterday.
Over the past six or seven years, Equinix focused more on making multiple- and hybrid-cloud services easy for enterprises to access from its data centers, he added.
“When you think about the next five to 10 years, I believe that security, storage are two examples of areas that you will be able to consume at not only Equinix, but other data center companies,” Smith said.
These historically hardware-based sectors are increasingly moving into software and as-a-service models of deployment. “They’ll deploy a lot of those stacks at companies including ours,” Smith said. “Enterprises coming in to consume IT will be able to use the networks that are there, the clouds that are there, access the security capabilities that are there, the storage companies. When you think what’s inside a data center it’s compute, storage, and networking. Anything in those spaces we can make easy to consume at Equinix we’re probably going to go after.”
This strategy has paid off for Equinix, which recently posted its 59th consecutive quarter or revenue growth. The company reported $1.152 billion in revenue for the third quarter of 2017, a 25 percent increase compared to the previous year.
Equinix has 200 data centers in 24 countries around the world. Last month it made a deal to buy Australian data center company Metronode for $792 million in cash. This acquisition will add 10 data centers to Equinix’s current five in Australia, and improve its position in the Asia-Pacific region.
Also last month it launched a new cloud service that allows its data center customers to connect directly to any other Equinix customer on demand.
Smith said he expects Equinix enterprise cloud services — including the direct connections it provides to hyperscale cloud providers — to continue to boost revenue in 2018.
“These 400,000-plus enterprises are trying to figure out how to take advantage of this paradigm shift to the cloud,” he said, adding that three or four years ago, Equinix had between 700 and 800 enterprise customers in its data centers.
“Since the cloud has been unfolding, we’re up to 2,700 to 2,800 enterprises that are now deployed somewhere at Equinix, using us to get access to the cloud or get access to the networks,” Smith said. “It’s our highest growth industry vertical.”
Correction: The company reported $1.152 billion in revenue for the third quarter of 2017, not $1.152 million as originally reported.