Growing Artificial Intelligence and High-Density Workloads are Requiring Leaders to Rethink their Hybrid IT Strategy Mix
CoreSite, an American Tower company (NYSE: AMT) empowering critical business and AI workloads that impact everyday life through interconnected data center solutions, today released its 2025 State of the Data Center Report, which examines the latest data center and cloud computing trends, strategies and requirements. Now in its sixth year, the 2025 report finds business and IT leaders are navigating a world where they must increasingly rely on digitization – particularly emerging technologies like AI – to innovate, generate revenue and modernize their organizations, all while managing costs in an uncertain economic environment.
The new research shows that while IT leaders are becoming more comfortable and adept at balancing workloads across on-premises, colocation data centers and the public cloud, there’s a key component missing: connectivity. As companies are turning more often to a hybrid IT mix grounded in colocation – due to colocation’s balance of performance, security, compliance and cost – only 19% of respondents said their colocation data center providers offer interconnection services.
“To have a truly successful hybrid IT environment, one that creates a secure and low-latency competitive edge, companies need seamless integration and connectivity across applications and services,” said Anthony Hatzenbuehler, Senior Vice President of Operations at CoreSite. “IT leaders are relying on colocation providers to bridge the interconnection gap by offering direct cloud interconnections to multiple environments across providers.”
High-level insights and key data points from this year’s report include:
- Organizations Embrace “Cloud-Smart”: Organizations are continuing to shift from a “cloud-only” to a “cloud-smart” or hybrid IT architecture, with 98% of respondents implementing or planning a blend of public and private cloud, on-premises and colocation services to run workloads where they perform best.
- Closing the Interconnection Gap: While most survey respondents consider direct connectivity through a colocation provider a “must have,” citing it as the top factor accelerating their digital transformation, only 19% say their colocation provider offers interconnection to a variety of cloud providers. CoreSite is one of only a few colocation providers to offer native cloud connections in its facilities.
- AI Shapes IT Infrastructure: The No. 1 reason respondents are choosing to host generative AI applications in colocation environments is the providers’ cloud interconnection. High-density power and cooling capabilities, cost, compliance and security are additional factors in that decision-making.
- Security is Table-Stakes: For the fourth year in a row, respondents noted physical security as the most important attribute when deciding on which colocation provider to work with.
“The report findings show a decisive shift of AI workloads into colocation data centers, which emphasizes that AI is fundamentally reshaping enterprise infrastructure strategies,” said John Gallant, Enterprise Consulting Director at CIO. “Modern colocation facilities are rising to the challenge by delivering a mix of high-performance compute environments with specialized AI hardware, predictable cost structures for large-scale deployments, direct cloud interconnects and the flexibility to run workloads wherever they deliver the most value – empowering organizations to innovate at scale while maintaining control and compliance.”
The 2025 State of the Data Center report is based on a quantitative survey of 300 CIOs, CTOs and other IT decision-makers representing a variety of industry sectors, plus in-depth interviews with seven senior technology executives from financial services, healthcare, retail and SaaS organizations. Industry leader Foundry, an IDG, Inc. company, conducted the research.
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