The New Year will be a fresh but difficult start for European telco and data center service provider Colt. The company, whose owner Fidelity Investments recently took it private, will start 2016 with a new CEO and a new CTO, both of whom start January 1.
London-based Colt announced the appointment of former Pacnet CEO Carl Grivner as its new CEO in September. The company said this month that it had chosen Rajiv Datta, who was formerly COO at AboveNet Communications, as its new CTO.
Colt’s previous CEO Rakesh Bhasin, who came to the company from Fidelity, will return to work for the US investment giant.
Colt, like other European telecoms, has been struggling to maintain revenue growth, due in part to regulatory price cuts, according to The Telegraph.
Revenues in the sector have been slipping for the last six years, affected by competition from free voice services, such as Skype, and a series of regulatory reforms, which forced service providers to cut roaming charges and fees carriers charge other carriers for using their networks to terminate calls, according to Reuters.
Europe’s biggest telecoms are forecasting a return to growth next year, but Colt exited the wholesale market for voice calls in 2014. It is also exiting the IT services market, choosing to focus on data center and core network infrastructure services, all to improve profit margins.
The company owns 34 carrier-neutral data centers in Europe and manages seven in Asia Pacific. It greatly expanded its Asia Pacific footprint earlier this year by acquiring Fidelity-backed Japanese service provider KVH.
Competition in the European data center services market will not be easy, especially following this year’s wave of consolidation.
Silicon Valley-based data center services giant Equinix took over TelecityGroup, one of Europe’s biggest players, becoming the biggest provider in the market.
Japan’s NTT Communications bought German provider e-shelter, substantially increasing its presence in Europe and becoming a more substantial competitor for deals with customers who want data center and network capacity in Europe and Asia.
Fidelity was one of Colt’s founding investors. It owned most of the service provider’s shares until this September, when it bought the shares it didn’t already own — they were trading on the stock market — and took the company private.
Fidelity’s offer for the shares valued the company at £1.5 billion.