CENX, Interxion Bring Ethernet Exchange to Europe

April 12th, 2010 by · 1 Comment

Interxion and CENX today announced they will be working together to develop a Pan-European Carrier Neutral Ethernet Exchange.  The initial node will open in London in June, followed soon thereafter by nodes in Paris and Amsterdam, with more to follow through the year.  CENX, of course, was the first to open the doors to such an Ethernet exchange in the USA.  Interxion, on the other hand operates some 26 data centers in 13 cities in Europe, and their entry into the Ethernet Exchange market is not unexpected.  

This arrangement seems like it's win-win for both.  Partnering with CENX brings them a US dimension they could not otherwise offer.  Likewise, CENX needs a European presence and this partnership allows them that without diverting their attention from getting their US business model right.  Both are jockeying for position in their respective markets with Equinix (NASDAQ:EQIX, news, filings), and it's no accident that this announcement coincided with Equinix's formal launch of its competing service, which happens to also include a node in London.  

This is turning into something of an arms race, as CENX and Equinix match initiatives and PRs.  It's almost as if they view this as a Highlander-type situation.  You know ... 'there can be only one."  I am interested in opinions from readers on whether the economics of this new line of business favor dominance by a few or a proliferation of providers.  With efforts by tndm in process and others rumored to be on the way, I guess we are going to find out.

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Categories: Datacenter · Ethernet

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  • Frank A. Coluccio says:

    re: “I am interested in opinions from readers on whether the economics of this new line of business favor dominance by a few or a proliferation of providers.”

    It’s not as though there’s little or no history to draw on here. We’ve been to this show a few times before, I think. Telegraph, voice switching, NCP/TCP**, Frame Relay, ATM, MPLS… more than a few times, in fact.

    During this nascent period, coming off a zero baseline it’s difficult to prove whether a profusion of operators over a short term will lift all boats or sink the first few that set sail, once the viral effect of what’s happening here kicks in. The motivations differ from the standpoints of bleeding edge exchange operators who are using Ethernet “meet-me” points as a means of differentiating their colo and peering businesses, vs., say, the larger number of established carrier hotels and IP exchang points globally that could very easily fall into line once the proof of concept is nailed.

    Having said all that, I think there’s a window of opportunity for garnering new customers both in terms of transport and colo/exchange-point share, but the advantage will in relative terms rapidly become diluted, just like every other pipe offering with time. However, offsetting the dilution of market share there will be a concomitant increase in overall flows. Like I said, we’ve seen it before. For now it’s got promise, in other words, but IMO it will become a commodity offering sooner than many hope.

    ** An item that some here may find interesing:

    “Moving Beyond TCP/IP”, by Fred Goldstein and John Day for Pouzin Society

    http://siliconinvestor.advfn.com/readmsg.aspx?msgid=26458915

    Frank

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