Private Connectivity at the Edge to Grow by 47 PC Annually

Private Connectivity at the Edge to Grow by 47 PC Annually

October 17, 2019

Equinix President of Asia-Pacific Jeremy Deutsch says APAC is a fertile ground for technological development, with the proliferation of 5G, IoT, VR and AR precipitating the enormous growth of interconnection bandwidth in the region.

The latest Global Interconnection Index (GXI), an annual market study published by Equinix, claims global private connectivity at the edge grow by 51 percent CAGR, and is expected to exceed a total bandwidth capacity of more than 13,300 Tbps, which is equivalent to 53 ZB of data exchanged annually. To give perspective, this equates to enough bandwidth to support every person on earth simultaneously downloading a complete season of Game of Thrones in ultra-high definition resolution in less than a single day.

The GXI market study also claims that interconnection bandwidth is an essential component to digital business and validates that to compete in the digital economy, companies must address growing data volumes and increasing data exchange velocity across a rising number of clouds and business ecosystems.

In Asia-Pacific, interconnection bandwidth is expected to grow at 56 percent CAGR to exceed 3,825 Tbps by 2022, contributing 29 percent of the global capacity.

Among industries, Cloud and IT services is expected to consume the most interconnection bandwidth, reaching 914 Tbps, which is forecast to outpace growth (50 percent CAGR) of clouds in all other regions. Singapore is one of the top metros in the region, and it is expected to grow at 47 percent CAGR from 2018 to 2022.

According to Cisco Senior Vice President Enterprise Networking Business Sachin Gupta, as enterprises embrace the imperative of digital transformation, they are increasingly adopting multiple cloud-based applications to meet their objectives. This places pressure on the network to deliver a fast and secure application experience to users located anywhere in the world.

“With both applications and networks becoming more distributed, enterprises today will continue to require a low-latency, interconnected architecture to securely connect end users with business-critical applications,” says Gupta.

According to Datacenter & Cloud, IDC Research Vice President Rick Villars, a separate survey commissioned by Equinix of more than 2,450 global senior IT professionals, including more than 100 senior IT professionals in Singapore, shows that 65 percent of Singaporean organizations are currently expanding into new regions, countries or metros, and 60 percent of them plan to use virtual connections to support their expansions.

“People, software and machines are creating and consuming data faster and in all the places where we work, play, and live. The significant increase in data created, aggregated and analyzed in these new locations is contributing to a major shift away from deploying IT in traditional corporate datacenters. Enterprises need access to robust, modern data center facilities near the edge locations where businesses want to deploy dedicated infrastructure and interconnect to the increasing number of clouds, customers and partners that are at the core of digital transformation efforts,” says Villars.

Key Findings

Equinix says the GXI Vol. 3 delivers insights by tracking, measuring and forecasting growth in interconnection bandwidth—the total capacity provisioned to privately and directly exchange traffic, with a diverse set of partners and providers, at distributed IT exchange points inside carrier-neutral colocation data centers. The GXI claims:

The ability to exchange large volumes of data through interconnection is essential to compete in the digital economy

The GXI forecasts that in order to manage the growing volumes of data, global enterprise consumption of interconnection bandwidth will grow at a 64 percent CAGR (68 percent in Asia-Pacific), outpacing other forms of business data exchange.

The GXI shows that to manage increasing volumes of data, enterprises globally are on average deploying in nine locations, with a total of 340 interconnections to networks clouds and business partners; and,

The Equinix survey found that almost half of global IT decision-makers (45 percent in Singapore) believe interconnection is a key facilitator of digital transformation, and nearly half of all global IT decision-makers (39 percent in Singapore) believe interconnection can help their business to gain competitive advantage within the marketplace.

Distance is the biggest performance killer for digital business

Deploying direct, private connections at the edge propels both application performance and user experience. According to the GXI, today’s latency-sensitive workloads require response times ranging from <60 to <20 milliseconds, forcing IT infrastructure closer to the points of consumption.

According to the Equinix survey, more than one-third of global IT decision-makers (40 percent in Asia-Pacific and 39 percent in Singapore) are using interconnection to increase speed of connectivity.

Competitive advantages in using a combination of key interconnection deployment models

Interconnecting to multiple network providers across multiple edge locations is the most prominent use case for interconnection bandwidth and is expected to grow 4x by 2022.

Interconnecting to multiple clouds and IT services across multiple edge locations and cloud regions represents the next largest and fastest use of interconnection bandwidth and is predicted to grow 13x by 2022; and,

Interconnecting to digital business partners for financial services, content and digital media and supply chain integration makes up the remainder of interconnection bandwidth use cases and is forecasted to grow 5x by 2022.

According to Equinix President of Asia-Pacific Jeremy Deutsch, APAC is one of their most vibrant markets, making it a fertile ground for technological development.

“We are excited to see the proliferation of 5G, IoT, VR and AR provide the impetus for the enormous growth of interconnection bandwidth in the region. Being interconnected has never been so important for enterprises seeking to keep up with customer expectations which often require massive volumes of data to be processed and analyzed at the edge, within a matter of seconds. That is why Equinix continues to be committed to staying ahead of evolving customer needs and supporting them in accelerating their digital transformation journey. With the latest GXI report indicating that interconnection bandwidth is set for continuous growth in the region, we are here to help businesses embrace digitalization for success,” says Deutsch.

(Ed. The Global Interconnection Index, published annually by Equinix, is the industry’s only market study that projects how interconnection bandwidth growth will unfold through 2022. Equinix claims the report serves as a market baseline that analyzes the deployment profile of thousands of ecosystem participants using carrier-neutral colocation data center providers globally. Please see the detailed methodology description included in the Global Interconnection Index.)

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