CAPRE Exclusive | Credit Suisse’s Sami Badri Talks Tariffs, Views Valuation, and Asks Why Colocation is Accelerating Now

ATLANTA, GA – CAPRE’s Fourth Annual Greater Atlanta Data Center & Cloud Infrastructure Summit featured a keynote presentations by Sami Badri, Senior Analyst for Credit Suisse, titled “The Acceleration of Colocation in 2019,” which dove deep into questions large and small about the state of the data center supply chain – which covers everything from Juniper and CISCO to Equinix and Digital Realty. In this CAPRE Insider Report, we highlight some critical questions that Badri expounded on to illustrate why he thinks things are about to significantly accelerate on the adoption side. Will Tariffs Impact Data Center CapEx? First, Badri provided a bit of insight from the 2019 Credit Suisse CIO Survey that honed in on the impact of tariffs -- drawing from the data illustrated in the slide above. "We asked them, following the imposed tariffs, are you considering public cloud services more with less on-premise deployments given the change in costs?" shared Badri. "Because if you remember, looking at the Trump tariffs, a lot of the equipment costs went up. In other words, when you ran your cost-benefit analysis to deploy your own public cloud versus the dominant public cloud services, did the tariffs all of a sudden change your decision?" Badri shared that in January of 2018, 36% actually answered yes. But that response rate actually decreased by about 29% in July of 2019. "So despite the tariffs and despite the increased costs – in some cases, 25%…