The capacity for private data exchange between businesses is outpacing the public Internet, growing at nearly twice the rate and comprising nearly six times the volume of global IP traffic by 2020, according to the Global Interconnection Index, a new market study published by Equinix that analysed the adoption profile of thousands of carrier-neutral colocation data centre providers and ecosystem participants globally.
As business models become increasingly digital, distributed and dependent on the real-time engagement of many more users, partners and service providers, the Index is a powerful new research tool. It highlights how companies are translating digital transformation into action and creating entirely new ways of connecting with their customers, partners and supply chain. The Index will provide an annual baseline to track, measure and forecast the growth of Interconnection Bandwidth, defined as the total capacity provisioned to privately and directly exchange traffic with a diverse set of counterparties and providers at distributed IT exchange points.
According to the Index, Interconnection Bandwidth is expected to grow at a 45 percent CAGR to reach 5,000 Tbps by 2020, dwarfing Global IP traffic in both growth (24 percent) and volume (855 Tbps). It is also growing faster than Multiprotocol Label Switching (MPLS), the legacy model of business connectivity, by a factor of 10x (45 percent to four percent).
Russell Poole, managing director, Equinix, UK, commented: “UK business and industrial sectors are being disrupted in ways we could not have previously imagined. As the public internet has continued to expand, it has impacted how organisations do business and created opportunities for some of the greatest innovations of this era. This innovation, also described as the Internet of Things has resulted in an unexpected explosion of data which businesses are struggling to analyse and process by relying on the public internet.”
The Index provides significant insight into metropolitan differences in how Interconnection is accelerating in various European cities. Despite Brexit, London will continue to top the European leaderboard in terms of Interconnection Bandwidth capacity. With an average growth rate of 44%, the British capital is set to triple its private data exchange from 114 Tbps to 486Tbps, a significant lead of 48.15% over Frankfurt, more than double the interconnection bandwidth capacity of Amsterdam and a whopping 75% ahead of Paris. However, in a sign that Frankfurt may emerge as a Brexit winner after all, the German financial centre is poised to overtake Amsterdam, with a jump from 51 Tbps to 252 Tbps in 2020.
Russell Poole added: “Interconnection Bandwidth growth will dwarf global internet traffic in three years. The survival of the UK’s business industries post-Brexit and the success of the UK’s economy will rely on organisations that adopt an interconnection-first approach as data production grows at a rapid rate. It’s encouraging to see that London will maintain its status as a leading digital economy by 2020.”