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Summary

On September 24, 2018, Digital Realty Trust (DRT) announced the acquisition of Ascenty, a leading Brazilian data center provider with assets in Sao Paulo, Rio de Janeiro, and Fortaleza. Ascenty's customer base comprises the leading global cloud providers. The acquisition provides a platform for further southern hemisphere expansion for DRT as part of its global-scale ambitions.

DRT adds data centers, a gateway, and a platform for growth

DRT has been on a mission to achieve global scale. In 2017, it completed the acquisition of scale data center provider DuPont Fabros, adding substantially to its megawatt footprint in northern Virginia, Chicago, and the Silicon Valley. DRT has also been growing organically over the last year with new data center capacity in Singapore, Sydney, Osaka, Frankfurt, Dallas, Silicon Valley, and Toronto. Latin America was a noticeable hole in its global footprint which Ascenty will now fill.

The global cloud providers have been expanding in Latin America via investments in data centers and subsea cables. With the addition of Ascenty assets, DRT can offer a global-scale data center platform, strengthening its position in growing cloud ecosystem.

Africa is also an ambition for global cloud providers. Fortaleza is a key gateway node-first point of entry with subsea cable connectivity to Africa, North and South America, and Europe. Ascenty's Fortaleza data center site includes low latency connectivity to the local cable landing stations. Ascenty brings not only data centers but 4500km of optical network as well. Brookfield Asset Management is a co-investor with DRT in the Ascenty acquisition and has nearly 10,000km of road, pipeline, and electrical transmission assets, the classic right-of-way properties.

If DRT desires to be one of the select few truly global-scale data center providers, it will need to continue to grow its portfolio. The Ascenty acquisition quickly adds a Brazilian footprint, providing a platform for expansion into the rest of Latin America and a beachhead in another growth continent.

Appendix

Further reading

Market Share Spreadsheet & Analysis: 2Q18 Optical Components, SPT003-000022 (September 2018)

High-Speed OC Forecast: 2018–23, SPT003-000021 (September 2018)

Market Share Spreadsheet: 2Q18 Data Center Interconnect (DCI), SPT002-000118 (August 2018)

Global Data Center Analyzer: 2018,SPT003-000018 (August 2018)

Author

Ian Redpath, Practice Leader, Components, Transport and Routing

ian.redpath@ovum.com

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