October 15, 2019
Sydney’s Private Connectivity at the Edge Forecast to Grow by 49 Per cent Annually
Market study shows Cloud & IT is the largest industry leveraging interconnection as data explosion gets further distributed at the edge
SYDNEY, Australia – October 16, 2019 – The latest Global Interconnection Index (GXI), an annual market study published by Equinix, predicts global private connectivity at the edge grow by 51 per cent compound annual growth rate (CAGR), and expected to exceed a total bandwidth capacity of more than 13,300 Terabits per second (Tbps), which is equivalent to 53 zettabytes (ZB) of data exchanged annually. This is 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 finds 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 per cent CAGR to exceed 3,825 Tbps by 2022, contributing 29 per cent of the global capacity. Among industries, Cloud and IT services is expected to consume the most interconnection bandwidth, reaching 914 Tbps in Asia-Pacific, which is forecast to outpace growth (50 per cent CAGR) of clouds in all other regions. Sydney is one of the top metros in the region, and is expected to grow at 49 per cent CAGR from 2018 to 2022.
In addition, a separate independent survey commissioned by Equinix of more than 2,450 global senior IT professionals, including more than 100 senior IT professionals in Australia, shows that 48 per cent of Australian organisations are currently expanding into new regions, countries or metros, and 73 per cent 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,” said Rick Villars, Research Vice President, Datacenter & Cloud, IDC. “The significant increase in data created, aggregated and analysed in these new locations is contributing to a major shift away from deploying IT in traditional corporate data centres. Enterprises need access to robust, modern data centre 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.”
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 centres. The GXI finds:
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 per cent CAGR (68 per cent 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.
The Equinix survey found that almost half of global IT decision-makers (44 per cent in Australia) believe interconnection is a key facilitator of digital transformation, and nearly half of all global IT decision-makers (40 per cent in Australia) 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 per cent in Australia) are using interconnection to increase speed of connectivity or reduce latency.
Leading businesses are gaining competitive advantage using a combination of key interconnection deployment models
Interconnecting to multiple network providers across multiple edge locations is the most prominent use case for
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.
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
- Sachin Gupta, Senior Vice President, Product Management, Enterprise Networking Business, Cisco
“As enterprises embrace the imperative of digital transformation, they increasingly adopt 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.”
Jeremy Deutsch, President of Asia-Pacific, Equinix
“As one of our most vibrant markets, Asia-Pacific has become 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 analysed 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 digitalisation for success.”
Glenn Uidam, Senior Director, IBX Operations, Equinix Australia:
“The Global Interconnection Index Volume 3 provides incredibly useful insights into the rise of the digital economy and the subsequent growth of interconnection around the world. The rapid growth in Sydney demonstrates the importance of interconnection for organisations across Australia looking to digitally transform their businesses. With the strength of Australia’s technology growth, it’s exciting to see Sydney as one of the top locations in the region where businesses and professional services, telecommunications, cloud & IT services are utilising interconnection. This demonstrates the value of interconnection, and Equinix’s coverage across Australia and the region can help more customers on their digital transformation journeys.”
About the Global Interconnection Index (GXI)
The Global Interconnection Index, published annually by Equinix, delivers insights that drive digital business advantage by tracking, measuring and forecasting growth in interconnection bandwidth—the total capacity provisioned to privately and directly exchange traffic with a diverse set of counterparties and providers at distributed IT exchange points. The Global Interconnection Index is the industry’s only market study that projects how interconnection bandwidth growth will unfold through 2022. The report serves as a market baseline that analyses the deployment profile of thousands of ecosystem participants using carrier-neutral colocation data centre providers globally. This data was combined with local and regional market data (including macroeconomic trends, market demographics and industry concentrations) to form a weighted demand multiplier to assist in predicting growth and assess impact on digital business transformation. A detailed methodology description is included in the Global Interconnection Index.
About the Equinix independent survey
As part of a separate independent study commissioned by Equinix, APCO Insight surveyed 2,485 IT decision-makers from a diverse enterprise set across North America, Latin America, Europe and Asia-Pacific. Respondents were selected for participation from Dynata’s online panel. The survey was conducted online between August 1-16, 2019.
Forrester Total Economic Impact Study (TEI) [analyst report]
Gartner Exploring the Edge: 12 Frontiers of Edge Computing [analyst report]
Gartner: Infrastructure is everywhere [analyst report]
Taking Digital Business to the Edge [Equinix blog]
Equinix, Inc. (Nasdaq: EQIX) connects the world's leading businesses to their customers, employees and partners inside the most-interconnected data centres. On this global platform for digital business, companies come together across more than 50 markets on five continents to reach everywhere, interconnect everyone and integrate everything they need to create their digital futures. Equinix.com.au
This press release contains forward-looking statements which are based on current expectations, forecasts and assumptions that involve risks and uncertainties that could cause actual results to differ materially from expectations discussed in such forward-looking statements. Factors that might cause such differences include, but are not limited to, unanticipated costs or difficulties relating to the integration of companies or new ventures we have acquired or will acquire into the Equinix platform; unanticipated costs or difficulties relating to expansion into new markets; the challenges of acquiring, operating and constructing IBX data centres and developing, deploying and delivering Equinix services; a failure to receive significant revenue from customers in recently built out or acquired data centres; failure to complete any financing arrangements contemplated from time to time; competition from existing and new competitors; the ability to generate sufficient cash flow or otherwise obtain funds to repay new or outstanding indebtedness; the loss or decline in business from our key customers; and other risks described from time to time in Equinix filings with the Securities and Exchange Commission. In particular, see recent Equinix quarterly and annual reports filed with the Securities and Exchange Commission, copies of which are available upon request from Equinix. Equinix does not assume any obligation to update the forward-looking information contained in this press release.
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