Friday, 22 October 2021 12:42

Digitally mature businesses in Australia expanding digital infrastructure 4x faster than pre-pandemic levels

Equinix senior vice president of marketing Claire Macland Equinix senior vice president of marketing Claire Macland

Sydney and Melbourne forecast to grow interconnection bandwidth at 43% and 50% CAGR supporting accelerating enterprise access requirements to cloud and network providers, concludes Equinix in their latest Global Interconnection Index.

The latest Global Interconnection Index (GXI Vol. 5), an annual market study published by Equinix, reveals that the pandemic has forced economies into digital overdrive, with digital leaders, businesses who were already implementing a digital-first strategy, moving four times faster than pre-pandemic levels.

These Australian businesses have compacted the time to deploy their digital infrastructure to multiple regions, expand to multiple edge locations and integrate multiple clouds — what might have taken two years is now achievable within six months, the index states.

This accelerated pace of digital transformation is predicted to continue to fuel the rapid growth in interconnection bandwidth. According to the GXI Vol. 5, overall interconnection bandwidth, the measure of private connectivity for the transfer of data between organisations, is forecast to reach 6,002 terabits per second (Tbps) in the Asia-Pacific region by 2024, representing a five-year compound annual growth rate (CAGR) of 46%. This will make up 28% of global interconnection bandwidth. This growth is aligned with the increasing demand for the digital infrastructure needed to bring more businesses online, facilitate electronic integration with partners and supply chains, and reach more people in distributed hybrid work environments.

Additional Asia-Pacific / Australian Insights From GXI Vol. 5:

  • The four core locations in Asia-Pacific, which includes Sydney, are forecast to grow to 3,624 Tbps, supporting accelerating Enterprise access requirements to Cloud and Network Providers. Sydney is forecast to grow to 661 Tbps by 2024, expanding interconnection bandwidth capacity at 43% CAGR. Sydney has more interconnection across Enterprise verticals compared to other metros, showing growth in direct connections between business and ecosystem partners.
  • Melbourne is forecast to grow to 55 Tbps by 2024, expanding interconnection bandwidth capacity at 50% CAGR. Melbourne shows one of the largest percentages of Enterprise (and Financial Services) of any metro in the Asia-Pacific region, with nearly half of connections to business partners and growing digital ecosystems
  • Enterprises in Asia-Pacific are forecast to grow to 2,111 Tbps, consuming 35% of the regional interconnection bandwidth, primarily led by Finance Services and Manufacturing. Driven by advanced digitisation of services, Banking & Insurance is forecast to overtake Manufacturing by 2024, growing 40% faster.
  • According to global deployment data, which includes an analysis of more than 500 organisations that deployed some 5,000 implementations worldwide between Q1 2016 and Q1 2021, Sydney was ranked in the top six metros worldwide in four industries – Network, Cloud & IT Services, Content & Digital Media and Business & Professional Services.
  • Sydney is also ranked first in Asia-Pacific in Content & Digital Media and second in Network, Cloud & IT Services and Business & Professional Services. Melbourne was ranked fifth in Asia-Pacific in three industries, including Network, Cloud & IT Services, and Securities & Trading.
  • Digital leaders are interconnecting with 10 times as many partners, enabling them to ride the wave of digital transformation and enjoy best-of-breed services from a vast pool of Service Providers and partners. The trend has been tracked across 12 industries and three regions for traditional companies, born in the cloud, Service Providers and even hyperscale providers.
  • The Public Sector, Healthcare & Life Sciences, Energy & Utility, Industrial Services and Consumer Services are expected to experience the fastest digital infrastructure growth in Asia-Pacific, which is forecast to drive 47% CAGR in interconnection bandwidth from 2020 to 2024. These industries that were previously lagging in interconnection adoption are now leading in interconnection growth rate as a result of the pandemic.

“While COVID has forced businesses to innovate in many ways, by both expanding existing and introducing new digital services, the infrastructure underpinning these services must keep pace,” said Equinix senior vice president of marketing Claire Macland. “As a result, savvy businesses are now moving four times faster than pre-pandemic levels in deploying this necessary digital infrastructure.”

“Australian companies that have adopted a comprehensive digital strategy as a core business pillar—connecting with and leveraging digital platforms with partners, ecosystems and customers, consistently emerge as disruptive market leaders. Adopting digital platforms and services is essential to achieve agility and the resilience that is required to outpace and out-innovate the competition,” said Equinix Australia managing director Guy Danskine.

“We’re seeing more organisations distribute edge infrastructure into carrier-neutral locations, closer to the end points where business is happening. In Australia, Melbourne continues to emerge as a strategic metro where digital leaders continue to deploy near customers, employees and their operations.”

This first appeared in the subscription newsletter CommsWire on 20 October 2021.

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