In an effort to meet the rising need for data centers,
) opened the second International Business Exchange (IBX) data
center in downtown Seattle. This new SE3 data center has been
strategically placed near Equinix's SE2 data center, enabling
existing customers to expand their operations at the same
The improvement in demand is also evident from the findings of
independent research firms such as Gartner. According to this
technology research firm, the total public cloud services market
size is expected to increase from $91.4 billion in 2011 to $206.6
billion in 2016.
The emerging markets including India, Indonesia and China will
see high growth rates. The increase in public cloud services
would automatically increase data center demand.
Another data center industry tracker -
"lifelinedatacenter.com" explains that in 2013, data center
companies will face new technological challenges such as a
growing demand for
(a collaboration of private and public clouds),
, wherein service providers will maintain cloud infrastructure
within the data center, and
remote employee access technology
.The data centers may have to also work on improving the
Expansion in important markets and consolidation of facilities
in existing ones has been a part of Equinix's core strategy. The
company is continuously striving to boost its revenue base as
well as profitability by improving its technology to attract more
clients. Moreover, its recurring revenue model has provided the
much-needed support to its revenue stream over the years.
Although Equinix is using new marketing strategies and
improving its technological base to attract more customers, a
long sales cycle, high debt level and lower business potential in
Europe may rationalize its growth prospects.
Equinix carries a Zacks Rank #2 (Buy). Investors can also
consider other stocks such as
Acme Packet Inc
Arris Group Inc.
), which have a Zacks Rank #1 (Strong Buy) or
), which has a Zacks Rank #2 (Buy).
ACME PACKET INC (APKT): Free Stock Analysis
ARRIS GROUP INC (ARRS): Free Stock Analysis
CA INC (CA): Free Stock Analysis Report
EQUINIX INC (EQIX): Free Stock Analysis
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