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The Hidden Frustration and Impact of UK Data Centre Closures

Saturday, Jan 29th, 2022 (12:01 am) - Score 6,456
Equinix MA2 Data Centre Manchester

At the end of last year Equinix suddenly informed clients of their MA2 IBX data centre in Manchester that they intended to close the facility. Such moves typically create an unwanted extra expense for UK broadband ISPs and full fibre (FTTP) builders, among others. Not that consumers would notice.

The closure of a data centre, which often comes as a shock to customers, can create a “major surprise expense” for those affected, as one disgruntled client of the aforementioned centre told us, because they end up having to rebuild into a different building (exceptions may exist for managed clients). In the case of MA2, Equinix already has several alternative centres in Manchester (e.g. MA1, MA3 and MA4).

NOTE: Equinix also has various data centres in London (e.g. LD3, LD5, LD6, LD8, LD9, plus new ones at LD4, LD7, LD10).

Closures like the one mentioned above don’t usually occur due to a lack of demand either, and if anything, there seem to be far more centres currently being built than shut. For example, Equinix only recently announced plans to build a new £61m International Business Exchange (IBX) data centre in the Agecroft Commerce Park in Salford, which is to be called MA5 (due to be completed in Q2 2022).

All of this begs the question, why close such centres in the first place? According to the letter that Equinix sent to its clients, the company has been evaluating their “real estate portfolio“, which includes “determining which assets are strategic to our business … and the cost/benefit analysis of continuing to operate specific sites.” Apparently, MA2 “no longer meets our criteria for continued operation.

The same letter notes that Equinix’s lease on MA2 is due to expire soon, and they will stop operating it from 30th June 2023.

A Spokesperson for Equinix told ISPreview.co.uk:

“As stewards of some of the most important digital infrastructure in the world, we regularly review our IBX data centre footprint to ensure it is aligned with both our customers’ needs to interconnect with vibrant digital ecosystems, as well as our long-term strategic business goals, including striving for sustainability excellence. We believe highly scalable and resilient campus environments are the best way to curate these digital ecosystems, and when appropriate, we make the decision to close legacy sites and work with customers to migrate their operations to optimal locations.

After a thorough evaluation, it has been determined that the expiration of the lease on MA2 in 2022 provides an opportunity to close the site and that it is in the best interest of customers located at MA2 to migrate to an alternative IBX data centre facility, where they will gain access to a wider selection of interconnectivity options, business partners and best-in-class IBX data centre facilities and services.”

Much as we said earlier, Equinix are not the only data centre operator to hit customers with such an announcement. Meridian House in Docklands is another, while Telehouse Metro went at the end of 2020. Oracle is also reported to be considering the closure of its Linlithgow data centre in Scotland and all of this is before we consider smaller DCs, which are harder to track.

The suspicion from some quarters is that some of these closures, particularly when they impact smaller DCs, may have been fuelled by demand from more profitable housing developments. But in other cases it could simply reflect a wider transition toward the cloud, or the need to scale-up into bigger or more cost-effective premises. The only upside is that most DCs do seem to give plenty of time to adapt (often measured in years).

None of this will cause too much of an impact for the major network operators (e.g. Openreach, Virgin Media, CityFibre etc.) because many of those have their own DCs (or exchanges), but smaller players can be much more exposed to such changes. Ultimately, ISPs and network builders have no choice but to adapt to such closures, but thankfully the drama rarely impacts consumers (unless something has gone very.. wrong).

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Mark-Jackson
By Mark Jackson
Mark is a professional technology writer, IT consultant and computer engineer from Dorset (England), he also founded ISPreview in 1999 and enjoys analysing the latest telecoms and broadband developments. Find me on X (Twitter), Mastodon, Facebook and .
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Comments
12 Responses
  1. Avatar photo Tom says:

    MA2 has always been an odd facility for Equinix, and in some cases for Telecity before that, largely because they do not control the power supply to the building – it’s subtended amongst three entities (Equinix, iomart & the UoM). Fine if you’re a smaller operator, but there’s margin there that Equinix can’t control. Recently the building (Reynolds House) has had landlord (taken over from DRT) and I’m presuming there have been lease renewal negotiations that haven’t gone to plan; perhaps because of pending plant refurbishments? Those of us in Manchester that watch this market carefully, aren’t too surprised.

    1. Avatar photo Tom says:

      Though… It goes without saying that it’s a very well connected building, with a lot of ducts. It would make an excellent foothold in total – removing the subtended leaseholders totally – for an established carrier neutral provider to take over in full. I’d thought that was DRT’s plan when they bought the building, but as they’ve now sold it on, the goal is less clear.

  2. Avatar photo Aled says:

    I hear Tom’s point. But when a lease is up for renewal, there’s usually a moderate level of bargaining and brinksmanship that goes along with it.

    If I was in an expensive building I’d be demanding a significant price reduction when lease renewals are reviewed during covid times. The usual dance is that the landlord raises prices by 5-10% and the renter wants 5-10% discount. It’s not rare to see the renter announce informally they are quitting the facility to see if the rent demanded drops, as the landlord may take several years to negotiate a new tenant and get more income.

    That said, I know nothing about the individual building, nor its suitability for housing. So I could be talking nonsense.

    1. Avatar photo Andrew says:

      More likely to be a case that the legacy building won’t continue to meet Equinix very high standard without significant investment from the landlord, who in this case is a minor competitor in this space.
      To be fair the addition of MA5 and the digital infrastructure company’s sustainability and focus on renewables, it makes more sense to invest in future assets they own Vs leasing IMHO

  3. Avatar photo Concerned colo customer says:

    Any source for Meridian House being shut?

    1. Avatar photo N says:

      Digital realty. It’s official.

  4. Avatar photo Sunny Slough says:

    Slough seems to be turning into a place for computers to live just outside of london, with good links into the city. There are no closing DCs here.

    1. Avatar photo DaveIsRight says:

      Yeh but it’s still Slough innit?

      😉

    2. Avatar photo Funnyman says:

      At least the computers don’t have to commute far

  5. Avatar photo jimmy says:

    Not really a surprise, I’m sure M247 are happy as I’m sure it’ll be a lift and shift across the road.

    1. Avatar photo Anon says:

      They have an office there, but I thought their datacenter space was on Trafford Park?

      Quite a few alternative options around that area.

  6. Avatar photo MilesT says:

    Dealing with a forced hosting partner exit at work (unsure if triggered by a data centre termination or just hosting partner changing business focus).

    The result in our case is moving the affected systems to a well known public cloud, and I’m sure that will be the net result for quite a few businesses affected by data centre closure/hosting exit.

    Ultimately lost business to the data centre provider/hosting partner, strengthening the hand of a few big players (Amazon, Microsoft, Oracle, and some less well known cloud providers).

    And some potentially nasty software license impacts in infrastructure shifts, both transitionally while systems move, and variances in new infrastructure, hosted and especially cloud/virtualized (particularly looking at you, Oracle, IBM). Tread very carefully!

Comments are closed

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