Telecom providers will invest heavily in data center facilities in the immediate future to grow revenues, predicts a new report from analyst firm Research and Markets.

The report, The New Telco Data Centre - Pricing for the New Telecoms Data Centre - 2014 to 2019, suggests telcos are making plans for an expansion of multiple hosting, cloud, networking and power requirements.

Telcos are making data the center piece of their strategy for getting more profit out of their investment in networks and striving to bring old silos of data together.

The study method was based on a TCL survey of 57 telecom providers around the world that have developed their own data center infrastructure.

Analysis of the data created by this survey identified 2,200 telecom provider data center facilities with around 2.9m sq m of space available.

Certain telcos now spend between US$100m and US$300m developing each large campus-based data center facility says the report.

At the high end of the telco sample, some are planning to build multiple data halls for cloud services across multiple countries.

Modular data centers represent another important trend, as these new fast and flexible building blocks allow telcos to build by increments and adapt to changing customer demand.

There has been a migration taking place, towards cloud services, that will continue for the next five years, says the report, as key hosting and IT applications (such as server hosting, security and disaster recovery & back up services) are virtualized and offered as an on-demand service.

Virtualization will be the foundation on which telcos begin to create a more fluid set of services that can be provisioned more skilfully and offered as a variety of flat rate pricing models, according to the report.

“The telecom provider is becoming more circumspect about bidding for large IT outsourcing deals. Instead they are providing partial outsourcing of individual applications or services using a virtualized on-demand platform,” said the report.

Overall new data center revenues are forecast by the author to increase by 28% per annum over the five-year period from the end of 2014.

This will take them from $3.1bn per annum in 2014 to $7.5bn a year by 2019.