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Data Center News > Blog > Global Market > Is colocation the secret to unlocking AI’s full potential?
Global Market

Is colocation the secret to unlocking AI’s full potential?

Last updated: July 13, 2025 1:56 pm
Published July 13, 2025
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Is colocation the secret to unlocking AI’s full potential?
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Mark Pestridge, Government Vice President & Common Supervisor for Telehouse Europe, believes digital transformation and AI ambitions are inserting colocation on the centre of tomorrow’s tech methods.

The speedy rise of AI is reshaping how organisations function, compete, and develop. However a proliferation of AI options means extra workloads working within the background. S&P International, in a worldwide survey of IT decision-makers commissioned by Telehouse, discovered that 76% of AI workloads are hosted within the cloud or information centres.

Nonetheless, most organisations aren’t simply specializing in AI. Many stay engaged in important, ongoing technical transformations, so colocation suppliers should be able to supporting present digital calls for whereas providing infrastructure versatile sufficient to scale for future AI integrations. Placing this stability is essential to information centre operators servicing the market.

Heavy funding in AI

The organisations adopting AI are investing closely in its improvement. 16-20% of general workloads are AI-related. And whereas hyperscalers dominate the AI workloads market with 35%, third-party colocation information centres maintain a ten% share of the market. There’s a mixture of things that inform the place organisations buy their AI workload colocation companies from. GPU as a service (18%), specialised cooling (15%), and GPU-based compute set up (13%) are the highest components.

Crucially, the GPUs which might be very important for AI processing are solely as dependable because the cooling programs that help them. AI functions drive considerably larger energy densities, so conventional cooling programs must be complemented by extra superior options within the information centre setting. Liquid expertise will transfer into the highlight consequently. Liquid cooling basically wants much less energy than conventional air cooling, making it a extra environment friendly, dependable technique.

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Liquid cooling can be central to attaining AI-associated objectives, however its adoption additionally brings quite a few different instant advantages to information centre operators. It permits for the augmentation of rack densities, with some in a position to attain a formidable 100KW per rack to help a variety of power-hungry workloads. And liquid cooling strategies often have a decrease vitality consumption, supporting price financial savings and an improved PUE score. Operators obtain a decrease general carbon footprint to help digital transformation targets associated to environmental, social, and governmental (ESG) methods.

The significance of cloud on-ramps

Cloud on-ramps additionally serve to learn organisations of their digital transformation methods. As a direct, safe connection between a knowledge centre and a cloud service supplier, they allow sooner, extra dependable, and safe entry to cloud companies. Cloud exchanges with hyperlinks to the main cloud suppliers, corresponding to Amazon Internet Companies and Microsoft Azure, can allow low-latency connectivity between enterprise networks and different cloud companies by way of a non-public connection.

Along with supporting companies with present-day digital calls for from clients, cloud on-ramps are prime of thoughts for supporting AI workloads. Greater than 90% of corporations understand these on-ramps as both important or fairly vital to AI/ML structure, and so they can be utilized for a number of AI-related capabilities. This consists of transferring information into and out of the cloud for coaching inferencing functions, alongside the transportation of AI-related information for evaluation. Colocation companies can subsequently be on the centre of distributed AI workloads that make use of public cloud companies.

Consultancy and value-added companies

Whether or not for ongoing transformation methods or long-term AI ambitions, the flexibility to entry skilled steering is essential for organisations. Based on the analysis, 20% cite AI/ML consulting companies as the highest differentiator when contemplating a colocation supplier. For healthcare and life sciences corporations particularly, the provision of IT abilities and experience is important.

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Distant and sensible arms companies supplied by main information centre operators can present help and recommendation on the place enhancements could be made to fulfill organisational objectives. Good arms companies in colocation services can present the pliability to make configuration adjustments to tools and set up new tools to help instant priorities and AI improvements within the long-term.

Colocation on the centre of innovation

AI is reshaping the expertise panorama, and what’s more and more clear is the position of colocation in supporting this evolution. These services supply the infrastructure, connectivity, and experience that organisations must stability right this moment’s calls for and the necessities of the long run. Superior cooling programs, direct cloud connectivity, and value-added companies all come collectively to place colocation suppliers on the centre of evolving workloads, whether or not they’re centred on digital transformation or AI.

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Contents
Heavy funding in AIThe significance of cloud on-rampsConsultancy and value-added companiesColocation on the centre of innovation
TAGGED: AIs, Colocation, full, potential, Secret, Unlocking
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