Equinix (EQIX) Aids Zoom To Extend Digital Infrastructure

Equinix, Inc. (NASDAQ:EQIX) recently announced that Zoom Video Communications, Inc., a provider of video-first unified communications, will use Platform Equinix in a bid to broaden its globally distributed footprint. This also supports Zoom’s worldwide growth acceleration objectives.

Utilizing Platform Equinix’s global reach, Zoom can scale up its ability to deliver top-quality conferencing services for customers without any time lag or downtime across different geographies.

Further, Platform Equinix will enable Zoom to deploy important service delivery infrastructure while providing a direct connect to the latter’s digital set-up.

Zoom has been collaborating with Equinix since 2015 and has been capitalizing on the company's colocation and interconnection portfolio. Through this alliance, Zoom now partners Equinix to set up part of its digital infrastructure in Equinix’s International Business Exchange (IBX) data centers across nine markets, namely Frankfurt, Amsterdam, Melbourne, Hong Kong, New York, Tokyo, Toronto, Silicon Valley and Sydney.

Further, to strengthen its inter- and cross-region capabilities, Zoom banks on Equinix Cloud Exchange Fabric (ECX Fabric), an on-demand, SDN-enabled interconnection service that facilitates a connect between a company's own and another entity’s distributed infrastructure. This offers Zoom the benefit of low-latency access to its networks, clouds, customers and partners by interconnecting in close proximity.

Notably, with increasing popularity of cloud computing, IoT and big data as well as the use of third-party IT infrastructure by several companies, data-center REITs are witnessing a steady boom. Additionally, the estimated growth rates for AI, autonomous vehicle and virtual/augmented reality markets will be consistently robust over the next five to eight years. This will significantly propel growth for data-center REITs, such as Equinix, Digital Realty Trust (NYSE:DLR) , CyrusOne Inc. (NASDAQ:CONE) , CoreSite Realty Corp. (NYSE:CORR) et al.

Over the past six months, shares of this Zacks Rank #3 (Hold) company have gained 12.8%, outperforming the real estate market’s rally of 5.3%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

However, given the data-center real estate market’s solid growth potential, competition might intensify in the upcoming period from the existing as well as the new players. As a consequence, an aggressive pricing pressure is anticipated in the data-center market.

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