Digital Realty Trust, Inc. (DLR) Earnings Call Transcript & Summary

Good afternoon, everybody. Thank you for joining -- at least, my final keynote presentation at the Truist Internet, Security and Services Investor Day. On today's call, we have Chris Sharp, CTO; and John Stewart, Head of Investor Relations from Digital Realty Trust. Gentlemen, thank you, both, for kicking off our conference. It's always good to have folks such as yourself at this conference. And Chris, thanks for standing in for Andy at the last minute. I know we had a last-minute swap path. It's very helpful to do that, would have hated to cancel that.

Absolutely. Appreciate it. Happy to be here, Greg.

Thanks very much, Greg.

If investors want to ask a question, what I would tell them is to email me, and I will do my best to get the question aired. Before we begin, though, I need to read the following disclaimer. This call is arranged by Truist Securities Research for use by institutional investors and issuer clients as defined by FINRA. If you're not an institutional investor or issuer, please disconnect at this time. For required disclosures, please see our website at truistsecurities.com or our equity research library.

With that said, I guess we can kick right into gear here and start to questions. Chris, you've been around the business for a long time, both on the networking side of things as well as at competitor, Equinix. Is it fair to open by asking you what attracted you to DLR? And what are you doing from a technology perspective to enhance what was already one of the dominant platforms in the data center industry?

Yes. No, absolutely. Happy to dig into that a little bit more. And I think it's important to understand, right, where I've been at Digital now for almost 6 years. And what was interesting at Equinix is we spent a lot of time around what were our customers trying to achieve within our colo-only environment, right? And I think one of the things that I got really in tune with is the fact that colo was limiting, and that interconnection was misunderstood, right? And I think one of the things that really highlighted towards the end of my career at Equinix was I spent a lot of time and probably many people on this call were, is cloud friend or foe? Like what was going on? Like this new cloud thing's happening. And so I ran a team there called the Cloud Acceleration team. And the core intent of why I created that group there was to ensure that we were aligned to how the clouds were going to evolve. And I think a lot was learned in understanding where the market was headed and quite frankly, where the clouds were headed and maintaining relevance to that shift, right? Because I think there's multiple tech shifts that I'll talk about today on this migration of the public cloud, what does it mean? How is it going to mature? One of the things we highlighted rather quickly was being able to consume those public cloud services privately. And so me working in multiple facets through the many years that I was at Equinix, it really opened my eyes up to the fact that it came down to 2 simple elements. And John and I often talk about this because I wrote a thesis on why I left Equinix and came to Digital. And in that thesis, there was 2 core components, one being interconnection and the other being scale, right? And what I mean by that is interconnection, it's all about being frictionless, right? Removing complexity from customers so they can get the value of interconnecting to multitudes of customers, partners, applications, whatever it be. You really need to have an open platform to do this any to any type of communication in a very secure, reliable manner. And I think one of the things that I learned rather quickly was really, customers, they don't want to buy a cross-connect, right? They want the value out of accessing that other infrastructure or device and getting the data out of that. And I think that's something that we've really done an excellent job at Digital in building out our service exchange, and really evolving our company to be an open interconnection platform that allows any to any type of communications. And I think I've often talked about in many public forums about going beyond the cross-connect, right, where we're really allowing customers to click-to-procure or click-to-access multiple data stores. And then the second element that I referenced is scale, right? So scale, one of the things I learned, if you have a colo-only environment, you're really good at winning Phase 1 of their deployment, right? So once that customer started to expand Phase 2, Phase 3, they outgrew that colo-type of capability. So having a pervasive product offering where cab cage or multiple megawatts allow customers because, quite frankly, they don't care about colo or scale. They really want to understand, can I future-proof my deployment? Can I live with a partner that I can do Phase 1, Phase 2, not only in size but power, density because infrastructure is rather quickly, right, like the power densities. And so we want to be able to have support multiple generations of our customers' infrastructure. And that's where coming from a scale arena and being able to bring in with the likes of Telx, Telecity, these colo capabilities, which, too, brought interconnection capabilities, that's what really is the underpinning of what differentiates Digital Realty. And quite frankly, as we talk about it today, platform digital. So those are the underpinnings of what I've always looked at and what brought me to Digital early on. And then the last piece, I think, that's important for this group is the most efficient supply chain wins, right? And efficiencies are afforded in multiple factors. I'll focus on one for the sake of this conversation. Efficiency of achieving a hybrid IT deployment or a hybrid multi-cloud deployment is extremely important to a lot of our customers. Those efficiencies are, how do I interconnect? Or where do I interconnect? Or where is my data being created? Or where is my data being stored? Allowing that any-to-any very efficient access because one of the things I think is amazing is Ashburn, Virginia. It's the epicenter of all of these clouds, affording an enterprise customer the ability to put a single rack at the epicenter of every major hyperscale cloud service provider is very differentiated. That provides a lot of efficiencies. And so that's kind of the use case that we continually replicate globally with all of our acquisitions and partners. But bringing that all together and being a place where not only these hyperscalers have been able to land and expand, but also the enterprise is starting to really wake up, and like, "Wow, it is a hybrid world. I need to have efficient access to all of these data sets globally. Who is the partner or platform that I can work with to achieve that?" And that's the core of kind of why I transitioned and being able to go up the stack, if you will, from scale and providing very discrete colo and interconnection capabilities. But that's kind of the underpinning of what drove my career and the success that we, quite frankly, see right now at Digital Realty as being a core partner, a global partner for a lot of these enterprises trying to achieve these desired hybrid IT, multi-cloud architectures.

Well, it seems like you're having the intended effect there. That's for sure.

Yes. No. It's been a while to come together. I won't lie, but we're very, very proud of what we've been able to achieve. And we continue to build that out over time.

You've given us a really good understanding of what you've been trying to achieve there in a very short period of time. Does it make sense or is this too redundant to talk about just some of the bigger picture technology trends that have been driving the data center business over the past few years?

Yes. Yes. So I think there's multiple secular trends, right? Where I spent a lot of time looking at this because one of the things I always talk about is like at Digital, we're really customer-led. And there's kind of 2, just to keep it short, customer lens we look at, right? There's a hyperscale business with all these major service providers trying to get into a market and continually expand and evolve their infrastructure, and then there's an enterprise customer. So there's a lot of secular trends that are impacting their ability to be successful. But I would tell you, just being poignant because of what we're all experiencing now, and I hope everybody is doing well through the pandemic is these digital transformations and the distribution of not only the workforce but the applications we require. And Greg, we were just talking about Zoom, and we're, quite frankly, relying on it, right? So making sure that you have the right access and the right redundancy to bet your business on these applications is core to what's driving our business. So said differently, we constantly are working to support customers going through that global kind of digital transformation and getting closer to the applications and consuming those applications they bet their business on. But more discreetly inside of what's happening there and I think one that's not only -- it's kind of a double-clicking on digital transformation is hybrid IP, right? Where I think we're seeing early indicators from a lot of these major hyperscalers really starting to position new offerings to our collective customer base, right? Where if you look at Amazon, AWS, Outpost, we did a -- we continue to work with them actively to ensure that customers have a high success rate of deploying these hybrid IT designs. And I think that's one of the things that we see working through partners because when I say open, it's not only open around the data centers you can access or how you access different destinations. But open as in working with partners to achieve that desired income for -- in state for our customers. And so hybrid IT is one that I think is nascent but going to pick up over the year because of the benefits afforded to customers utilizing it. They have a higher success rate of achieving that hybrid IT, hybrid multi-cloud model, which quite frankly, provides the best economics, the best security and the best control of how customers are bringing it out. So I think inside -- I'll double-click one more piece on the infrastructure. One of the things that's been phenomenal -- and I love it because, I mean, I run a little bit of it here at home and constantly looking at how AI is evolving. Artificial intelligence is impacting every aspect of our life. And it has the opportunity to be very impactful towards every vertical customer base that we have today. And we're constantly excited about it because we have a unique design at Digital Realty that supports AI, right? Because one of the things people are really starting to understand is AI is extremely power dense. It requires a lot more power to support those chipsets, and it requires a different type of interconnect, right? Because you -- that's why the Data Gravity Index, and we continually educate customers on that methodology, that you need to be very aware of where your data resides and how you do your analytics against that. We're very uniquely positioned because of the data oceans that reside within PlatformDIGITAL, allowing customers to set up high-power dense AI deployments to then do quick analytics against their data to get the business decisions out of it. That's -- we worked actively, and we talk a lot with NVIDIA, Core Scientific. These types of things are highly repeatable across the business that we're very excited about, and we'll continually support going forward. So I mean, it's something that I'm happy to go into detail. I don't think -- I don't know if it's right for this audience, but I run a lot of computer vision here at home. I have a chicken coop that it understands if it's a fox or a chicken, right? But like AI is permeating everywhere, and there's a lot of value customers are getting out of that. And so we see that as a nice place that's going to be an evolutionary trend that's going to support Digital Realty because of our uniqueness of our design. We can support these high-power densities and that we're working with the right partners to enable, quite frankly, what I believe is one of the most simplistic designs or solutions for customers to be successful in deploying AI architectures. Because again, complexity is out there and complexity is right. So we constantly work to remove that on behalf of our customers and our partners so that the desired end state is useful to them.

That's great. And yes, we could all be at a rabbit hole on 10 different vectors of technology pretty easily. It's good to see you so excited about the ones that are in front of you today. The hybrid IT component sounds pretty fascinating in that I would assume it would reduce a lot of the enterprise friction as they migrate to the cloud. Is that something you're starting to see already? And is that one of the reasons why your new logo in the fourth quarter was so strong?

Right. It is. It is. And we constantly look at where customers are evolving from, right? And I think 2 trends at the highest level, there's a lot of derivatives within it. But either they're coming out of an enterprise data center or they're coming out of the public cloud, right? Like because they want to get to that hybrid multi-cloud end state or they realize that their enterprise data center is adjunct to where the value is or to where the data is being created and where the interconnection happens more efficient. Because pooling networks back to the enterprise, I mean, that is a known model that doesn't work for most states as we see today. So seeing those 2 trajectories, we absolutely see hybrid IT as being a critical element in removing friction, being highly secure. And that's why you see all of these major hyperscalers really embracing the fact that they want to be the single pane of glass that monitors and manages how workloads move between multiple destinations. And a lot of the work that we do with our interconnection is to equip that, to be the foundation to allow that plumbing to happen at unique rates. So higher throughput, more redundancy. But yes, no, absolutely, it's been a catalyst for it. And we see a lot of logos coming under that hybrid IT or digital transformation where they realize that through the pandemic, they make, "Wow, I'm betting my business on a lot of applications that I don't have secure redundant access to or I'm not collecting the data I should be collecting." So to expedite a little bit of that, which I think you've seen represented our new logos coming into Digital to achieve that desired end state, which we can support uniquely.

John, it's great. John, I don't want to get too far ahead of myself in terms of expectations, but the logo trend in the fourth quarter, I don't think too many people are extrapolating that throughout 2021. But it seems we might want to reconsider that?

Yes. I mean, it's something that I think is core to our business, which hopefully people are starting to understand where we're absolutely evolving the platform, right, where for many, many years, even pre my time being here, Digital was a phenomenal operator for these massive hyperscalers, right? And there's a lot of value in being able to truly match their plan and design a market, land banks, availability of power. That's all afforded now to our colo capability or even enterprise customers at the end of the day, right? So being able to provide these foundational levels, which creates a unique platform for customers to -- like an enterprise new type of customer to benefit from is demonstrable, right? Because quite frankly, what we're doing is we look at the fact that with our asset class and our heritage and unique capabilities, the target addressable market is pretty wide, right, where you're seeing these new logos come in. And what we like about them is being a global platform, they land and expand, right? Removing the barrier where they can go to multiple markets around the globe is important to us, but you're spot on, Greg. And we're very proud of the work that we're doing in our marketing efforts, in our sales efforts and our products to marry up towards allowing these new enterprises and these new logos that come in, and quite frankly, get the benefit that a lot of these other major hyperscale areas in the market. And I think it's funny. A long, long time ago, I learned there's a lot of papers written that they wanted the hyperscaler economics, right? And it's beyond economics. A lot of customers come to us and want the same reliability, security and affordability that Digital has provided to some of these larger customers that now is easily transferable to a lot of these new logos coming in. And so it's starting to build. There's a lot of replication in that, and we're very excited about it.

That's fantastic. In terms of the customer base out there, you said the segment had 10,000 different ways. And the 2 most obvious ways amid COVID is the ones that had a digital strategy before COVID and the ones that didn't have a digital strategy. I would assume that most of those new logos are ones that actually had the digital strategy in place and were capable of taking advantage of the systems you already had set up. Is there an expectation that as we get to the other side of this pandemic that the companies that were not part of -- didn't have a solid digital strategy then suddenly flow in as well?

Yes. I mean, there's different maturity levels, I mean, in different decision criteria. I think one of the things that I've been very proud of and working with our solution engineering team and solution architects, one of the things we were able to do rather quickly is virtual tours, right? Where -- like this is something that's not going to leave, right? Post pandemic, we will continue to do virtual tours because the time to procure is exponentially lower, right? We're now in a week, we could see 5 sites, 2 of them and through 5 locations, and we were able to get to a transactionable event. Now within a day, we can do 5 sites, and they get all the data and details they need. How that translates, I think, to our customers is there are customers that were like, "Oh, my gosh, I didn't have a digital transformation plan. This pandemic has turned everything upside down. Please help me." And so removing those frictions, showing them solutions, showing them partners that they could easily execute against, there's a lot of those logos that you see in our fourth quarter and third quarter, right? But I absolutely do feel that there are a lot of customers that are really working with the analysts and starting to understand, yes, there's a new way to architect. There's a new way to build. And we're going to see those also coming in throughout this year and next year because, quite frankly, with AI and digital transformation and how people are thinking about their architectures, this is a business differentiator for them, right? So what we love to see is we get use cases in the market and we [ spoke ] the efficiencies or how they architected. And there's a direct TCO, there's a cost savings there. But more importantly, there's a uniqueness in how they are able to interact with their broader supply chain or their broader partners. That is what we're seeing. People wake up and say, "Gosh, I do need to do this to stay relevant. So I do have to change rather quickly." I think we'll see that over the course of the next couple of years. And I'm very excited about some of the partners we're bringing and capabilities we're bringing to further stimulate that kind of growth within the business. So we're very excited about that.

You had mentioned a new way to build, and there's always a better mousetrap with each generation of data center. Can we talk a little bit about the obsolescence of older data centers? I mean, there are the whole data centers out there that are 20, 25 years old at this point. And you have some [ talented ] data centers that aren't exactly brand new. How should we be thinking about the obsolescence of the data center?

Yes. So that's something that like, honestly, we have one of the best teams in methodology to quickly and continually do assessments on our asset class, right? And I'll tell you, because of the market, because of the market dynamics, an older facility, we continually have the heritage to upgrade that, right? To retrofit the power distribution, retrofit the cooling. In certain markets, it absolutely warrants the capital investment, like there's no data center out there that can't be brought up to the state of the art, barring the capital allocation to do that, right? But not all data centers are equal. Where they're placed within the metro and how they're interconnected are not equal. And that's why we constantly look at there's some that absolutely don't make sense, right? And we don't see them as being viable going forward. But you'll always continually see us evolve towards where it does make sense to our core methodology. But the thing I would impress on the team is we have a discrete way to look at all of our assets. And because we've been building for so long, because people don't realize that a lot of our builds, particularly in North America, were ground-built. They're retrofits, right? So having that knowledge to take a building and retrofit it, so it is a very efficient delivery of colo or scale capacity. That's something that's near and dear to our heart that we constantly look at in the market. But yes, there's a lot of newer technology that's coming to market that makes that retrofit capability a little bit easier. But one of the things that we always look at is ensuring that when we deliver a design, and I referenced this earlier, it survives multiple iterations of our customers' infrastructure. Because one of the things that I think is lost on a lot of individuals is it's not a matter of if, it's when the entire architecture densifies in power, right? And so we're always looking at -- you got to look at your delivery mechanisms and how you evolve that. But that's one of the things that's core to our design. And it was very similar ethos with Interxion, right, Lex Coors. I mean, phenomenal designer in the industry for many years, that has designed all of the Interxion's portfolio. He has a very similar ethos to the way that we look at the market, which has been a nice marrying of talent and heritage. And quite frankly, the designs we have going forward are marrying of those 2 lessons learned in the industry that I think is very unique to what our customers get going forward.

Before we hop into a couple of those lessons learned, there was a fairly contentious merger event a year ago that we're lapping now. I just want to take one question from the field from a wireless networking visionary here at [ State Farm ], an e-mail about edge compute. "What does it mean from a technical perspective and opportunities for the company? And more generally, what are the business -- what business opportunities does 5G provide for data center providers like DLR?"

Love it. All right. So I didn't reference the edge piece earlier. I didn't know -- I love that you asked it. Edge is extremely important, right? And it's important for what it is and for what it's not, right? And I really like to impress upon people on this is that we look at the market constantly as spectrum, right, where -- how is new spectrum coming to market? And what are the opportunities there? And then we look at the other lens, which is workload. Like -- and I think why I'm saying what it's not is the workload hasn't been demonstrably defined in what it requires. Like what are the latencies, what are the power density? So it's very hard to build a data center-type asset to support that workload because, quite frankly, it's not here. But you got to really look at the industry and ensure that you have a foothold and partners to be relevant at how that spectrum comes out, which is what I think is core to the question. And so the technical aspects of 5G and saying it just to be in the most simplistic sense, virtualizing the radios and allowing the breakout to happen at a differentiated part within the metro is very important to us, right? I spend a lot of time on where that breakout is going to happen from all of these small cell macro tower, wherever it happened. We work extensively to make sure that, that happens within Digital because that breakout is where you can deliver your applications out to that spectrum, be it a mobile device, be it an IoT device, whatever it is. There is massive potential growth there. And so we constantly look at the underlying technology with O-RAN, whatever your flavor, but we're working with mobile operators just to understand where that breakout is going to happen. And quite frankly, bringing that back to PlatformDIGITAL. And you'll see us make some progressive announcements throughout the year on how we continually refine our edge thesis in support of collecting and aggregating that -- the new spectrums coming to market. I would say from a business perspective, we're very excited about it, right? We're constantly working with and we're a firm believer in our existing customer base with a lot of these hyperscalers that they will have the material workloads that come to market and provide those requirements. So I've often talked publicly about core to edge. And one of the great things is we have a phenomenal core with all these major hyperscalers, and we're constantly working as the most efficient access out to the edge. And so you'll see -- and you've seen us before talk with other partners, where we're getting very smart at ensuring that we aggregate as the spectrum comes to market, and we're in the right position to support the workloads as they come to market. But what's exciting to us is where that breakout happens is going to be a very unique interconnection point that we're very attuned with. And we're constantly watching and working with partners to make sure that we can support the business requirements out of that opportunity. Great question.

I wish I can take credit for it. Let me revert back to Interxion DLR. You had mentioned there were some lessons learned, I would assume, on both sides. Can we talk about this a little bit?

Yes, absolutely. And I spent a lot of time with the Interxion team. And, quite frankly, being a technologist, I love it, right? Where they had some industry luminaries, both David Ruberg, Lex Coors, I mean, very, very, very deep talent. And one of the things that constantly attracts me to work and where I spend my time, I wish I have that work-life balance, but that's elusive, but it is learning and aligning the heritage of these capabilities. And so working with that team and really where I think some of the lessons learned coming from Interxion back is, I guess I'll start with the shared ethos. They are a shared environment of how do you equip communities of interest to interconnect in a very efficient manner, right? And so they were constantly focused not only on the space and power elements and delivering that efficiently, but truly building out communities of interest that are heavily, heavily interconnected, that the constant value is being achieved within these deployments in the facility. So very similar ethos in that and what we've been doing and the work that I've been doing here 6 years. So that was very nice. I would say some of the lessons learned coming from Interxion are twofold. First being the ability that they did on how we master plan in markets and how they master play in markets, similar but different. And that they have very in-depth market maps that they look 5 years out, right? They really try to collect as much data to understand how they need to deliver infrastructure in that market. And quite frankly, I often also talk about this publicly, Marseille was a master stroke, right? Like the ability for what they brought inside of France and Marseille and back into Paris, that was a master stroke in understanding the demand criteria that was coming and ensuring that they had from the landing station, the cable landing stations out the right infrastructure to support that dynamic. So I think the way that they were data-driven and could apply that to multiple markets was excellent. I would say another lessons learned is new markets, right? I spend a lot of time with David in talking about where these new markets are going, and you guys have probably read a lot about it. I mean, the one -- I mean, the Altus in Croatia, but one of the ones I absolutely love and is publicly referenceable on the value is Lambda Helix. Like so what was great about Lambda Helix is not only were we in a position, and David was extensively working on these fields, is that we were able to secure the right assets at the right time in the market that once that deal closed, you saw every major hyperscaler announced that, that's the new availability zone. So being in that market early and having that capacity, that's something that we constantly are pulling back from the Interxion team to continually evolve PlatformDIGITAL in a very pragmatic way that there's quick validation on when we put a foothold in a new market. So I think that's something that we've learned. And then the adverse, right? Where scale is scale, you follow me? And we do scale like nobody else, right? So I think there's a lot of lessons learned in supply chain, delivery, operational efficiencies. I mean, we've got it down to a tee. And so I'd say a lot of the ways that we run, we operate, we design, and quite frankly, some of our products and replicating those products throughout, that's something that constantly we provide back to them. And I'd be remiss because if Andy was here, and I know I'm filling in for Andy, our balance sheet, the way we run our balance sheet, the way we view these markets, the way we fund some of this growth, it's all about efficient allocation of capital. And quite frankly, hopefully, Andy is not watching this. But Andy and Bill are probably some of the best finance minds in this industry, right? So the strongest balance sheet being applied now through Europe and through the growth there, that's a huge win, right? That translates to the right products in the right market for our customer base.

Sure. You had mentioned that Interxion did a great job mapping out cities like 2 steps ahead. I mean, they kind of had to because the way the deployments work over there.

Yes.

And you've certainly helped them just post-merger or they were running out of runway in Frankfurt. You solved that problem with one stroke of a pen.

Balance sheet comes into help, yes

In a big way. Going forward, did European deployments ever start to look like what we have here in the United States, the scale deployments? Or is it always going to be something a little bit larger than what you saw with Interxion?

Yes, I think that's a great question. And that's where you got to really look at the market dynamics, right, in the regulatory environment because it does impact the way infrastructure gets deployed. And I think because of the data sovereignty and the more distributed nature of the way that markets are maturing, I mean, I'd be remiss not to reference Brexit. Brexit is going to have a play into that and enforce decisions that we, quite frankly, in our platform with Interxion and the thought process there, we can support like no other, right? Where I don't think you're going to have an Ashburn, Virginia show up there just because of the market timing, right? It just doesn't equate. But what you will have is multiple hyperscalers and enterprises wanting to put assets in each of the key markets over there to achieve their data sovereignty compliance. So I don't think you obviously see the density of scale, but we are absolutely seeing the unique requirements where it's definitely getting larger. And so our ability to design that scale is definitely coming into play there. And you referenced Frankfurt and some of the other land banks that we're able to achieve there. It's a long-term plan that continually returns, right? Where master planning and thinking about a market over 5 years, it allows you with our balance sheet to place the appropriate bets to get a durable return out of these markets going forward.

Okay. Can we talk a little bit about tech as a source of churn? You have business failure, you have consolidation. You don't really have customers leaving you for another data center operator for 10% less on price. But you do have end-of-life applications that often cause customers, sometimes scale customers to decide to do their next deployment somewhere else.

Right.

How are you guys managing tech as a source of churn?

Yes, it's an important element, right? Like, I absolutely love spending my time with our customers and learning from our customers, both enterprise and hyperscale. I think the churn probably more relevant for this call and this audience is yes, like cloud, it's interesting, right? Where these hyperscalers, their lifespan of their infrastructure is definitely shortened, right, because of the efficiencies achieved or the, quite frankly, the compute or storage densities they need to meet their business. And you're also seeing specific chipsets coming out that are afforded to certain applications. So there's a varying demand of how their infrastructure evolves. We absolutely -- we often see, more times than not, that infrastructure ages and they bring in new, right, because the demand is up and to the right. And one of the also things that is misunderstood in the market, proximity matters, right? Like there's a reason why a lot of these optical gear companies are working on longer throws without amplification because they want to have the ability to extend that proximity and get that ultra-high throughput, right? And it's something that being an operator inside of Ashburn, Virginia, at the levels that we operate there, there's fractions of ability that we do in all of our other markets because, quite frankly, there's one customer Day 1, they needed 17,000-plus fiber pairs, Day 1. That's proximity matters, right? And I bet them, right, I bet him a beer and I'm like, listen, there's no way you're lighting this up Day 1. Well, they did, right? I was like, wow, right? Because of that proximity and the throw and the data densities that exist in either side of that architecture, that's why more times than not, we see them in the platform. We continually see them in the platform. But you're absolutely correct. There's other elements that do fade out or do shift to a different type of environment. But what's nice about our model is that expanded target addressable market I referenced, right? When a cloud leaves, an enterprise is happy to jump in there. Now it takes multiple enterprises to offset that, but that's the benefit and the value of our platform, right? Where these hybrid multi-cloud models, our platform is inherently but foundational to like the public cloud portion of that. These enterprises want to be [ adversed ] than that and benefit from the same capability. So it's nice to have a product line and a sales team and a marketing team that constantly look at how do we fill that in the most effective way possible. But that's core to what we've been evolving at Digital Realty since the 6 years I've been here. And that's Bill's vision is really executing on that blended product set because customers, no matter what they are, they need the benefit of our colo capabilities and our scale capabilities and deliver it in the most efficient fashion, I would say.

Great. One last question I'll take from the audience. "How would you potentially partner with a wireless provider, DISH, T-Mobile, whoever and/or tower companies with regard to edge opportunities?"

Yes. So okay. I can't name names. I'll never name like -- so safe harbor statement from my perspective.

Fair enough.

We talk with them all. I'll drop it at that. So I'll speak about them in generality or in the most general sense, right? So like -- so I'd say the spectrum operators, they're very important, right, with the way that they're making decisions on how to deploy their infrastructure. And quite frankly, there's greenfield deployments, and there's retrofit to resistant deployments, right? And I think it's important that there's a nuance to those where predicated infrastructure, they're kind of leveraging a lot of that, right? Like the greenfields are very interesting to us. And so I spend a lot of time, and we constantly look at -- and we have some very, very deep expertise in our team where they're RF engineers. They know exactly the latency, the distribution, the requirement of the layered infrastructure to deliver 5G, deliver CBRS. And so we're constantly working with them to ensure that as we look at the market evolve, where there's the far edge infrastructure required, there's going to be a lot of money wasted in deploying far edge because it's not going to be relevant to the workload or the breakout is not going to happen there. And so that's where we're constantly talking with them and getting educated on that. And so it's important to stay close to the details on that, and that's one of the things that I spend a lot of my time on. But then the other side of that is the tower operators. They're very important. And they're very different in the world, right? There is the macro tower, and there's all the small cell, right? Different value and different positions. We respect their businesses. We constantly have been working with them over the years on being the aggregation point for all types of their traffic coming off these towers. But there's a uniqueness, right, where that infrastructure edge might show up at some of these tower operators. We constantly are looking at that and looking at how that landscape plays out because there's a lot of efficiencies afforded to 5G in this edge as it evolves in leveraging existing infrastructure. And that's why I talk about core to edge. There's a lot of value in the core that we've already built and that we continually build up on that will constantly position these edge capabilities out there. And I think I'd be remiss, and John would ding me if I didn't talk about a lot of the edge work -- the edge use cases we're winning today, right? Like so we operate edge infrastructure, if you will, if you look at a latency radio zone, 350 Cermak, 56 Marietta, I mean, you can go down the list. We operate a lot of facilities today that are at the epicenter of some of the largest dense edge kind of environments. And so we're constantly winning those, but we always look at the spectrum, how it's going to be rolled out and how these tower operators are. But that's what I was alluding to. You will see us firm up our plans over the course of this year and next year on how that comes together.

That's fantastic. It sounds like really exciting times. Chris, thanks for taking the time to be with us. We went over a little bit. I appreciate you giving us all you have. And John, thank you for attending.

Thanks for having us, Greg.

Take care.

Take care, Greg.

Appreciate it.