Hong Kong to top Interconnection Bandwidth Growth in Asia-Pacific through 2021, contributing to region’s rapid growth rate surpassing United States and Europe
HONG KONG – September 19, 2018 – Equinix, Inc. (Nasdaq: EQIX), the global interconnection and data center company, today published the second annual Global Interconnection Index (the “GXI”), a market study that analyzes traffic exchange globally. The study reveals that global Interconnection Bandwidth is forecasted to grow by 2021 to 8,200+ Terabits per second (Tbps) of capacity, or the equivalent of 33 Zettabytes (ZB) of data exchange per year, a dramatic increase over the previous year’s projection and ten times the projected capacity of internet traffic1. This represents a significant compound annual growth rate (CAGR) of 48% by 2021, almost double the expected 26% CAGR of global IP traffic.
Asia-Pacific’s Interconnection Bandwidth is expected to grow at a 51% CAGR to 2,200+ Tbps by 2021, growing much faster than the United States and Europe. Hong Kong is expected to see the fastest Interconnection Bandwidth growth in Asia-Pacific, growing at a 55% CAGR due to the city’s thriving and diverse business ecosystems, including financial services, cloud and IT, and enterprises.
“Significant macro, technology and regulatory trends are converging to form an unprecedented era of complexity and risk and forcing the integration of physical and digital worlds,” said Sara Baack, Chief Marketing Officer for Equinix, Inc. “The second Volume of the Global Interconnection Index has found that companies are solving their increasing digital requirements by directly connecting to key business partners through Interconnection, as traditional forms of connectivity do not meet the demanding requirements of today’s businesses.”
Some of the key macroeconomic, technology and regulatory trends that have driven Interconnection growth in the past year and will impact its future growth include:
To capture digital value, companies will need to support real-time interactions by more strategically interconnecting the workflows across people, things, locations, cloud and data. The second Volume of the GXI identifies four classes of Interconnection use cases8 along with an IT maturity model. Adopted in combination, these use cases create a digital-ready infrastructure for today’s businesses:
“Fast and sustainable growth of our business is a key focus as we continue to expand our global presence. Interconnection allows us to create a single, global ecosystem and supports the infrastructure we need to continue to grow. Connecting with Equinix provides us with the ability to access infrastructure on-demand, whilst ensuring that we have complete control over our data and the ability to rapidly scale.”
“As enterprises increasingly adopt hybrid cloud architectures to accelerate their digital transformation initiatives, Interconnection is a proven design strategy for reaching cloud services such as Oracle Cloud Infrastructure in an efficient manner. Direct and private interconnection to Oracle Cloud Infrastructure FastConnect network connectivity platform helps provide predictable and consistent performance, isolation and availability.”
“As enterprises chart their paths to greater digitization, they seek pathways that avoid the turbulence generated by the growing complexity of integrating various digital services. New architectures anchored by Interconnection smooth this complexity and, increasingly, enterprises are finding that they also yield improvements in security, performance and capacity. Equinix’s Global Interconnection Index provides useful insight into these digital trends including why businesses are directly connecting with strategic partners to build their digital business ecosystems.”
“From Hong Kong to Sydney, Singapore to Tokyo, Asia-Pacific is a vibrant territory filled with tremendous diversity and opportunities. This is why the region has been continuously able to attract investment from multinational enterprises, and is undoubtedly why we are seeing such high projected growth for our region in this year’s Global Interconnection Index. To enable businesses to continue to flourish in our markets, a deep level of digital Interconnection is required so that businesses can simultaneously capture, correlate and transform the data into new customer value. That is why Equinix, as a leader in Interconnection, is perfectly positioned to help the region realize its huge potential. With our expertise in helping enterprises transform, we are confident that our Asia-Pacific customers will continue to thrive in the digital world.”
“Hong Kong is the fast-paced financial hub of Asia with many multinational enterprises looking to leverage the city’s position as a gateway to connect regionally and globally. As the economy thrives in the region, digital transformation is also driving businesses to simplify and integrate their IT infrastructures in order to maintain a high caliber of service. The need for Interconnection has never been greater and the growth of Interconnection Bandwidth has never been so important to the future of digital business in the city. We are excited to see the strong momentum of Interconnection Bandwidth growth in Hong Kong reflected in the second annual Global Interconnection Index. We will continue to play a critical role in helping businesses to embrace digitalization for success with our interconnection-first strategies.”
About The Global Interconnection Index
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. As crucial as Interconnection is to how digital business is conducted, it has never been quantified. The Global Interconnection Index changes this with industry-first projections of how Interconnection growth and access will unfold through 2021. 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. This data was combined with local and regional market data (including macroeconomic trends, market demographics and industry concentrations), and with key demand drivers of digital business, to form a weighted demand multiplier to assist in predicting growth to factor the impact of digital business transformation. A detailed methodology description is included in the Global Interconnection Index.
Equinix, Inc. (Nasdaq: EQIX) connects the world’s leading businesses to their customers, employees and partners inside the most-interconnected data centers. In 52 markets worldwide, Equinix is where companies come together to realize new opportunities and accelerate their business, IT and cloud strategies. Equinix.hk
This press release contains forward-looking statements that involve risks and uncertainties. Actual results may differ materially from expectations discussed in such forward-looking statements. Factors that might cause such differences include, but are not limited to, the challenges of acquiring, operating and constructing IBX data centers and developing, deploying and delivering Equinix services; unanticipated costs or difficulties relating to the integration of companies we have acquired or will acquire into Equinix; a failure to receive significant revenue from customers in recently built out or acquired data centers; 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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1 Cisco – “Visual Networking Index”, 2017
2 IDC FutureScape: Worldwide IT Industry 2018
3 IDC - Digital Transformation to Contribute US$9 Billion to Hong Kong GDP by 2021
4 Cybersecurity Regained: Preparing to Face Cyber Attacks, EY, 2017
5 Cybersecurity Threats to Cost Organizations in Hong Kong US$32 Billion in Economic Losses, Frost & Sullivan, 2018
6 Capitalizing on Your Business Ecosystems Economy: Gartner, 2017
7 Economic and Trade Information on Hong Kong, Hong Kong Trade and Development Council, 2018
8 The four classes of Interconnection use cases were developed by analyzing more than 1,800 industry implementations worldwide, are documented in the IOA® Knowledge Base, and have been validated by IT practitioners and industry experts.