Are growth rates in the data hosting and cloud services markets slowing? A warning from CenturyLink (CTL), owner of Savvis, is worth investigating.
CenturyLink (CTL), owner of the Savvis cloud services business, says its data hosting business is growing slower than expected. Is this the first sign that cloud computing market growth is set for a slowdown? Or is slowing growth limited to CenturyLink's own business execution?
CenturyLink took a $1.1 billion charge to reflect the slower-than-expected data hosting growth. My personal hunch: I wonder if the Savvis cloud buyout from 2011 has hit some integration and growth bumps. I've reached out to CenturyLink for comment to see if the data hosting write-down is related to Savvis.
For MSPs seeking to plug into cloud services providers, there's no cause for panic. Overall I believe CenturyLink and Savvis remain on firm financial ground. Plus, plenty of rivals -- such as Artisan Infrastructure, SoftLayer (now an IBM business), Tier 3 and ViaWest increasingly work with VARs and MSPs.
For a more complete list of cloud services providers, check out the Top 100 Cloud Services Providers (CSP) list. But just keep in mind: At some point the massive cloud growth wave will slow down. Overall I think we're still 18 months to two years from that point...
UPDATE, Nov. 6, 2013, 8:20 p.m. ET: Talkin' Cloud has some additional details about CenturyLink's earnings.