ViaWest growth in the Utah data center market

April 21st, 2011 | Posted by admin in Editorial | Viawest

Since 2010, ViaWest has been working hard to dominate the data center market in Utah. Several acquisitions and rapid management growth in the area illustrate ViaWest’s desire to position themselves as the dominant player in Utah. Will these efforts solidify ViaWest’s position as the market leader in Utah or is there still a lot of work to be done?

Let’s first take a look at the timeline of relevant press releases by ViaWest since 2010.

February 9, 2010
ViaWest hires a new Vice President and General Manager of Sales in the Utah Region.

April 20, 2010
Announcement is made about Oak Hill Capital Partners plan to acquire ViaWest.

May 25, 2010
Oak Hill Capital Partners closes on ViaWest Acquisition.

June 29, 2010
ViaWest announces data center expansion in Utah.

August 19, 2010
ViaWest announces a Salt Lake City customer expansion.

August 24, 2010
ViaWest hires a new Senior Vice President of Service Delivery.

September 9, 2010
ViaWest hires a new Executive Vice President of Sales & Marketing.

September 22, 2010
ViaWest hires a new Senior Vice President of Data Center Operations.

September 28, 2010
ViaWest hires a new Senior Vice President and General Counsel.

September 29, 2010
ViaWest announces a Salt Lake City customer win.

October 4, 2010
ViaWest announces the acquisition of the Consonus data center assets in Utah.

November 17, 2010
ViaWest hires a new General Manager for their Texas region.

December 6, 2010
ViaWest announces the acquisition of Utah data center provider, SingleEdge.

January 19, 2010
ViaWest hires a new General Manager in Salt Lake City.

February 15, 2011
ViaWest hires a new Vice President of Marketing.

From the press releases from 2010 to February 2011, we can see that ViaWest not only aggressively expanded their Utah presence, but they also hired new sales, marketing and general managers. For a company that has 21 data center facilities across the United States, it seems that they are focusing a disproportionate amount of effort on the Utah data center market.

Interestingly, on July 21, 2010 it was leaked on a Twitter Engineering blog that Twitter was moving their technical operations infrastructure into a new, custom-built data center in the Salt Lake City area. Local reporting in Salt Lake City indicates that ViaWest was not selected as the data center provider for Twitter.

It seems as though the Twitter leak revealed to ViaWest and Oak Hills Capital Partners who the dominant Utah data center player was – C7 Data Centers – and not SingleEdge, Consonus or Tonaquint.

It is difficult to say whether the Twitter leak motivated the hiring of new management or whether those positions were the result of the recent acquisition by Oak Hills Capital Partners, but between July 21, 2010 and September 28, 2010, ViaWest hired a new Senior Vice President of Service Delivery, Executive Vice President of Sales & Marketing, Senior Vice President of Data Center Operations and a Senior Vice President and General Counsel.

Immediately after hiring the new management team, ViaWest announces the acquisitions of Consonus on October 4th and SingleEdge on December 6th. It could be that the acquisition of Consonus and SingleEdge was a strategic move to prevent C7 Data Centers from acquiring them.

What is yet to be seen is whether C7 Data Centers or ViaWest will acquire other Utah data center providers Fibernet or Tonaquint in a move to expand their customer base and footprint.

After the acquisitions of Consonus and SingleEdge, ViaWest soon hired a new General Manager in Salt Lake City and a new Vice President of Marketing. Clearly, ViaWest is preparing itself to increase its share of the Utah data center market.

Questions remain though, as to whether the acquisitions of Consonus and SingleEdge will pay off. Although SingleEdge has some strong customers, such as Overstock.com, Consonus has been losing some key customers, such as WestHost due to downtime in one of its key data center facilities as a result of a error in their fire systems maintenance. Additionally, with the push for data centers to improve their power consumption efficiency, ViaWest could have to invest substantial capital to upgrade the SingleEdge and Consonus facilities.

It will be interesting to see whether ViaWest tries to acquire C7 Data Centers to further expand their footprint in the Utah market or if they decide to only expand their current facilities or build additional data center facilities.

As Utah becomes more and more attractive to data center providers (because of the low cost of power, low building costs, disaster safe geography and good connectivity) a major data center provider could potentially acquire both C7 Data Centers and ViaWest and leverage Utah’s advantages to up sell their customers a low-cost cloud, data backup or disaster recovery product to their top tier current customer base. But with high data center demand across the industry, moving into a second tier market likely won’t happen until the top tier markets cool. Until then, ViaWest is poised to go head-to-head with C7 Data Centers for the Utah market.

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9 Responses

  • It would be interesting to see if Viawest will try and acquire C7 Data Centers or whether either company will start acquiring other Utah data center providers in the future. As for Twitter choosing C7 Data Centers over other competitors, that was a big win for them.

  • Nic LeCheminant says:

    Just from this article alone, it kind of seems like ViaWest is in a bit of panic mode with all the hiring and management rearrangement. Like Alex said, it will be interesting to see what ViaWest does to counteract the success that C7 is having.

  • Greg Swain says:

    It will be interesting to see how each company will try and get a leg up on the other one. I’m also interested in seeing what other big companies are coming to the Utah Market, and if so what Company will win them over.

  • Jake Wilson says:

    While ViaWest certainly has a larger operation across the states, C7 Data Centers remains a major contender in the Utah area. And with a company of notable size and media attention like Twitter choosing C7 Data Centers over ViaWest and others, it’s easy to see reason for all the new hires and acquisitions on ViaWest’s part. The future of the Utah data center market will definitely be an exciting one.

  • Nick Fivas says:

    Both data centers seem to be great choices for companies to choose. The article covers what Viawest has been doing to improve there chances of being the number 1 pick, but it would have been nice to know more of what C7 has been up to.

  • Brandon Swain says:

    I can definitely see why Viawest has been making so many moves at expanding their presence in Utah, with low power and building costs, solid connectivity, as well as the growth and attention C7 Data Centers received with Twitter signing with them. It will be interesting to see the growth both companies see as the demand for Data Center space in Utah grows.

  • Ron Driggs says:

    It’s so awesome seeing Utah turn into “Silicon Slopes”. It’s great for the region to have so many large companies choosing to move their data center operations to Utah. This means more jobs and a boosted economy.

  • Brad Burkhart says:

    It is of no surprise why there is an expansion of data centers in Utah.
    1. According to FEMA Utah is tied for fewest natural disasters in the United States (http://www.fema.gov/news/disaster_totals_annual.fema)

    2. According to statemaster.com Utah has the third highest amount per capita of postsecondary degrees awarded showing Utah has an intelligent and competent workforce.

  • todd says:

    I’m sure ViaWest’s torrent of activity was more of a move to solidify their place in their Utah expansion and not so much to crush all competition. Though the fact that a huge powerhouse like Twitter would request a custom facility from a competitor is quite telling. If ViaWest does want to own the market, they seemingly have a long way to go.



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