Gartner Blog Network


Equinix CEO Steve Smith’s abrupt departure: Gartner Recommendation

by Ted Chamberlin  |  January 26, 2018  |  Submit a Comment

Most of you in the datacenter and colocation space have no doubt seen the news of last night: https://www.mercurynews.com/2018/01/25/redwood-city-tech-firm-equinixs-ceo-resigns-over-poor-judgment-on-employee-matter/

We don’t trade in speculation at Gartner; we do however, understand that Equinix is a popular choice for retail colocation and interconnection for our clients.  So here is what we know and our initial advice:

What we know and think:

  • Steve Smith, who had led Equinix for the past 11 years during massive growth and expansion, has stepped down.
  • Peter Van Camp, a veteran in the internet space with UUnet and Compuserve as well as past CEO and Chairman at Equinix, is temporary CEO.
  • A CEO candidate search is underway.  Their will be no lack of interesting candidates mentioned.
  • Equinix has always been top heavy in the executive ranks. That has created friction and at times, stiffled needed innovation.
  • I would not be surprised if an internal candidate emerged for the CEO role- Charles Meyers and Karl Strohmeyer make the most sense.

What we advise:

  • Unanticipated shifts in otherwise stable companies are never easy to digest. Equinix had been on a torrent in acquiring datacenter assets and steadily developing interconnection and cloud enabled offerings. This change in management will pump the brakes on M&A and potentially shift Equinix’s focus when new leadership is brought on board.
  • Enterprise clients- Status quo; no immediate need to rethink contracts in negotiation or renewals as day to day operations will remain unchanged.
  • Hyperscale/wholesale clients- I think the potential change is greater for this side of the business.  In the past , Equinix was more focused on enterprise sub 1MW deals; this year, the focus swung to wholesale leases more attractive to hyperscale cloud providers. This represents a fundamental change is facility design and power distribution. With new leadership, there is no gaurentee that the wholesale focus and deal flow will continue.

To reiterate- this is one to keep a eye on but no need to panic or make course changes until there is clarity around the new leadership.

Category: 

Tags: ceo  colocation  equinix  hyperscale  interconnection  

Ted Chamberlin
Research VP
18 years at Gartner
23 years IT Industry

Ted Chamberlin is a research Vice President at Gartner, where he is part of the Cloud and Communications group in TSP. His research focuses on the emerging cloud and hosting communications services like IaaS, PaaS, SaaS, colocation, application hosting, streaming and video content platforms, streaming and IoT and software-defined networking. Mr. Chamberlin has experience working with all size organizations from larger multinationals to early stage startups. Read Full Bio




Leave a Reply

Your email address will not be published. Required fields are marked *

Comments or opinions expressed on this blog are those of the individual contributors only, and do not necessarily represent the views of Gartner, Inc. or its management. Readers may copy and redistribute blog postings on other blogs, or otherwise for private, non-commercial or journalistic purposes, with attribution to Gartner. This content may not be used for any other purposes in any other formats or media. The content on this blog is provided on an "as-is" basis. Gartner shall not be liable for any damages whatsoever arising out of the content or use of this blog.