Bell buys Montreal data centre to fuel managed services play

Bell Canada Enterprises Inc. said its acquisition of Montreal-based Hypertec Availability Services‘ hosting division will allow it to gain traction throughout Canada in the hotly contested managed services market.

The purchase will give Bell control of Hypertec’s 105,000 square foot data centre, which is located in a building formally owned by Nortel Networks in Montreal. In addition to giving its Quebec corporate and public sector customers more space for their managed services and co-location needs, the company expects the facility will have an impact on Bell’s existing managed services customers across the country.

While he did not officially make an announcement, Joe Mardini, vice-president of sales of Bell’s business markets unit, said he could foresee Bell interconnecting all of its data centres in Canada to offer its customers more disaster recovery options and a fully redundant environment.

Mardini said Hypertec had over 40 customers currently using the facility, which leaves “a lot of room to grow within the building.” He added that as customers continue to become more comfortable putting their IT infrastructure into the hands of a service provider, the company will also be able to expand its services into business continuity.Bell also has data centre locations in Markham, Ont. and Calgary.

For Darin Stahl, a lead research analyst with InfoInfo-Tech Research Group Ltd. , buying a data centre site in Montreal is a wise move for Bell.

“Customers want a secondary site away from the Greater Toronto Area,” he said. “Putting it in Montreal makes a ton of sense. It’s also a major corridor for the telecom industry.”

In shifting its focus to managed services and co-location, Stahl said, Bell may also be able to shift some of its cost into its existing telecom business. “You need to have data connections and bigger pipes to tether data to remote facilities.”

Stahl cited Info-Tech data which showed that while 64 per cent of organizations engage in some form of hosted, managed or co-location service, only 34 per cent of those customers actually have their entire data centre outsourced.

“That means there’s a lot of capacity sitting around in these aging data centres,” he said.

Stahl said that leaves Bell with only one major concern: developing a name brand in managed services.

“They really need to be doing a better job at that,” he said. Working with mid-sized enterprises in his role at Info-Tech, Stahl said very few of them have Bell on their shortlist when deciding on a service provider.

Mardini said getting the word out will be a priority for Bell. The company will use its massive sales team to hopefully reach more enterprise customers.Bell’s purchase is the latest news in a series of recent data centre hosting-related announcements.

Earlier this summer, Toronto-based managed services and co-location firm Fusepoint Inc. was purchased by U.S.-based Savvis Inc. for $121 million.

Vancouver-based Peer 1 Network Enterprises Inc. and Toronto-based Q9 Networks Inc. also made news in the hosting market this summer. Peer 1 opened a $40-million Toronto-area data centre, while Q9 announced that it would built its sixth facility in the area with a new 240,000-square-foot data centre project that will cost $125 million.

The financial terms of Bell’s acquisition were not disclosed.

Follow Rafael Ruffolo on Twitter: @RafaelRuffolo.

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