On Thursday Equinix (NASDAQ:EQIX, news, filings) announced its intention to build a third data center in Amsterdam, Netherlands, located in the Amsterdam Science Park, one of the most carrier-dense locations in Europe.
The first phase of AM3 is expected to be completed in Q3 2012, adding approximately 1,400 cabinet equivalents. When the second and final phase is completed, the IBX will house approximately 2,800 cabinet equivalents, or a total of about 6,400 square meters (69,000 square feet) of customer floor space.
Equinix opened its first data center in Amsterdam in Q3 2008 (AM1), with phased openings through Q2 2009. AM2 officially opened in Q2 2010, adding about 1,000 cabinets to the company's footprint in the region, with phase 2 forecasted to provide about 500 cabinets in Q4 2011. A video tour of Equinix's Amsterdam IBX data center is available at this link. All data centers in the region are ISO certified and comply with the Payment Card Industry – Data Security Standard (PCI-DSS) housing specifications.
At the end of 2010, Equinix decided to acquire Amsterdam 1 and 2 buildings for $14.9 million, as they were considered strategic assets for the company.
After the opening of its third facility in Amsterdam, Equinix will have 5 data centers in the Netherlands, including two smaller ones in Enschede and Zwolle. Equinix acquired Virtu Secure Webservices B.V., a provider of network-neutral data center services in the Netherlands, in February 2008, following its 2007 acquisition of European colocation provider IXEurope, that allowed the company to expand to Europe.
In the press release, Eric Schwartz, President of Equinix EMEA, explained the reasons for this additional location:
The close proximity to various internet exchanges and the University of Amsterdam will make AM3 one of the key hubs for serving the European continent. Moreover, the extremely high carrier density at the Amsterdam Science Park enables customers to improve their networks’ and applications’ flexibility and resilience. As with other IBXs in Amsterdam, AM3 will deliver this high level of carrier connectivity combined with the Equinix Carrier Ethernet Exchange.
This further expansion is a strong testament of the importance of Amsterdam as a key Telecommunication hub in Europe. Demand for this location from both local and international customers has always been very strong, as Equinix indicated when it decided to expand its footprint to the Netherlands.
As a small example of the immediate success of the location within Equinix's multinational customer base, we could quote Taleo's (TLEO) decision, taken at the end of June 2008, before the opening of the facility, to include the Amsterdam data center in its footprint with Equinix:
Whereas Customer desires to assume the rights and responsibilities in the US Agreement in order to make use of the Services to be rendered by Equinix Netherlands in the data centre in the Netherlands (the “Amsterdam Data Centre”).
As a side note, this customer recently renewed its contract with Equinix, for the Ashburn (Washington DC metro) data center:
On May 23, 2011, Taleo Corporation ("Taleo") entered into a manual replacement statement of work (the "Agreement") with Equinix Operating Co., Inc. ("Equinix") pursuant to which Equinix will provide colocation services to Taleo. Pursuant to the terms of the Agreement, Equinix will provide space, electrical power and other colocation services at its web hosting facilities in Virginia for Taleo's hosting infrastructure. Under the terms of the Agreement, Taleo will pay Equinix aggregate fees of approximately $8.6 million over the next five years.
Back to Equinix's Amsterdam expansion, the company’s previously provided CapEx guidance of between $615 and $665 million in 2011 includes the forecasted 2011 spending for this new data center. The new LEED certified data center will use hot and cold storage in ground wells to avoid the use of powered cooling, where possible. Excess heat from the data center will be used to warm nearby buildings and for other third-party uses.
With the building of this new Amsterdam facility, Europe strengthens as the market with the most announced or in-progress expansions for Equinix (click to enlarge):