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Toronto Data Centers: The Benefits of Colocation in Queen City
Businesses today need robust, reliable, and secure data center solutions. Enter Toronto colocation – an ideal choice for companies looking to optimize their network performance, enhance data security, and scale their digital infrastructure.
In this blog post, we will dive deep into the numerous benefits of Toronto colocation. From the city’s strong economic base, optimal location, exceptional internet connectivity, and low natural disaster risk, discover why Toronto is quickly becoming a destination for businesses seeking colocation services.
Let’s get started!
Toronto Has a Thriving Colocation Industry
Toronto, the largest city in Canada and a major global business hub, presents numerous advantages for companies seeking colocation services. Colocation services in Canada are projected to grow 8.7% from 2022 to 2028, with Toronto and Montreal being primary beneficiaries.
In 2020, Toronto saw 38.1 megawatts of data center absorption. This was behind only Northern Virginia and ahead of markets like Dallas, Silicon Valley, Atlanta, and Phoenix. Microsoft, Meta, IBM Cloud, and Google expanded in the Toronto market in 2022. Overall, market demand produced 81 MW of pre-leasing in 2022.
As Toronto’s colocation industry has evolved, more significant data center operators, like Equinix, Urbacon, Digital Realty, and Q9, have established their presence in the city to serve the growing demand for larger deployments.
Toronto is home to 54 colocation data centers and facilities. Larger facilities include:
- Anexia Data Center GmbH (151 Front St. West Toronto)
- eStructure Data Centers ( 151 Front St. West Toronto, Ont.)
- Equinix Toronto (100 Wellington Street West M5K 1J3 Toronto)
- Amanah Data Center ( 341-151 Front Street)
Toronto is the Economic Heart of Canada
Why are so many data centers investing in Canada? In part because Toronto has a thriving economic base. The economy of Toronto is the largest in Canada, contributing 20% of the national GDP. The city’s economy is approximately $450 billion annually, greater than cities like Hong Kong, Philadelphia, and Seattle.
Toronto is the financial heart of Canada, with the Toronto Stock Exchange (TSX) being the third-largest stock exchange in North America by market capitalization. The city is home to the headquarters of Canada’s five largest banks and numerous other financial institutions, insurance companies, and investment firms. Toronto’s strong financial sector provides a stable economic foundation and supports job growth in the region.
The technology sector in Toronto has grown exponentially in recent years, making the city one of the top tech hubs in North America. Major technology companies such as Google, Amazon, and Shopify have offices in Toronto, while numerous start-ups and scale-ups call the city home. Toronto’s thriving tech scene is fueled by a highly skilled workforce, world-class universities, and supportive government policies.
These industries and more are driving the continued demand for colocation in Toronto.
Toronto Offers Excellent Network Connectivity
Toronto’s strategic location and extensive fiber-optic network make it an ideal destination for businesses looking for low-latency network connectivity. The city is home to the Toronto Internet Exchange (TorIX). TorIX is Canada’s largest internet exchange point (IXP) and one of the largest in the world. It consistently ranks among the top IXPs in North America in terms of both traffic volume and number of participants.
Toronto’s geographic location in northeastern North America offers excellent network connectivity to Canadian and U.S. markets. Businesses that colocate in Toronto can take advantage of direct fiber routes to major cities such as New York City, Chicago, and Montreal, ensuring optimal data transfer speeds and minimal latency.
Queen City also enjoys extensive network infrastructure from major cloud providers like Microsoft Azure, Tencent Cloud, Google Cloud, and Oracle Cloud. This provides colocation customers with simple, low-latency onramps to public cloud services.
With this extensive and redundant fiber-optic network, data centers in Toronto offer connectivity that’s among the best in Canada. The city’s proximity to major US networks makes data transfer speeds rapid, enabling seamless online experiences.
Toronto Has Low Cost, Reliable Power Supply
Commercial electricity rates in Toronto are approximately $0.08 to USD 0.12 per kWh. This compares with $0.15 – $0.21 in New York and $0.14 – $0.20 in Los Angeles. Power is one of the primary cost drivers for colocation services. Lower energy rates translate to lower colocation pricing.
Power rates are lower partially thanks to the availability of green energy sources like hydroelectricity. The city’s utility company, Toronto Hydro, has over 30,000 kilometers of transmission lines across 98% of Ontario, making it one of the largest electricity suppliers in the region.
Toronto Has a Low Natural Disaster Profile
Toronto’s low natural disaster profile is a significant advantage for data centers, as it minimizes the risk of damage or disruption to critical infrastructure and ensures reliable operation. The city’s geographical location and climate contribute to a reduced likelihood of severe natural disasters compared to other regions.
Here are some key factors highlighting Toronto’s low natural disaster risk and the advantages it offers for data centers:
- Low earthquake risk: Toronto is situated in a region with relatively low seismic activity. According to Natural Resources Canada, the city is located within an area characterized by low to moderate earthquake hazard, with a significantly reduced likelihood of major earthquakes compared to other areas, such as the west coast of Canada or the U.S. Pacific Northwest. This lower risk of earthquakes helps to ensure the structural integrity of data center facilities and minimizes the likelihood of service disruptions due to seismic events.
- Limited exposure to hurricanes and tropical storms: Toronto’s inland location and distance from coastal areas make it less susceptible to the damaging effects of hurricanes and tropical storms. While the remnants of such storms can occasionally impact the city, their intensity is usually significantly diminished when they reach Toronto. This reduces the likelihood of severe damage to data center infrastructure caused by high winds, flooding, or storm surges.
- Low risk of flooding: Although Toronto has experienced some flooding events, the city’s widespread, severe flooding risk is relatively low compared to other regions. Toronto has made considerable investments in flood prevention infrastructure, such as stormwater management systems and floodplain mapping, which help to mitigate the risk of flooding to data centers and other critical infrastructure.
Toronto Has A Strong Renewable Energy Profile
Businesses within the city also rely on energy from renewable sources like hydroelectricity, solar, and wind energy. Toronto’s Corporate Real Estate Management Net Zero Carbon Plan specifies that by 2030, 37 MW of renewable energy systems should be installed in every City-owned facility. This initiative allows colocation facilities and customers to reduce their greenhouse gas emissions and contribute to the province’s broader adoption of renewable energy.
Additionally, data centers in Toronto also benefit from cool temperatures throughout the fall, spring, and winter. This favorable weather allows innovative abient cooling systems to be incorporated into data center designs. Ambient cooling uses outside air to cool data center facilities. This lowers energy usage providing the dual benefits of lower cost and lower greenhouse emissions.
Colocation facilities can minimize their carbon footprints and meet sustainability goals by colocating in Toronto.
Learn More About Colocation Pricing in Toronto With Brightlio
Are you in need of retail colocation services? Brightlio provides competitive colocation pricing for Toronto and other global data center markets. Our expert team specializes in delivering customized colocation services that align with your company’s requirements and budget.
As a telecommunication broker, we offer additional I.T. services, including unified communications, public cloud solutions, network connectivity, and advisory services. We are committed to becoming your most trusted and responsive IT solutions provider.
Contact us today to learn how we can help you achieve your colocation needs!
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