As cloud services and distributed networks grow, and the Internet of Things (IoT) expands, the need to be connected across multiple platforms in multiple locations is constantly growing. Standard bandwidth is a metric that measures how much data can be sent over a network. Interconnection bandwidth is a metric that measures how ready a location or industry is to maximize its interconnection potential. It’s a measure of the total capacity to privately transfer traffic via direct interconnections at distributed traffic exchange points – hosted at colocation data centers that are carrier neutral. The interconnection bandwidth measurement helps companies understand which industries can benefit the most from increased connectivity.
The interconnection bandwidth boom
Interconnection increases transaction speed and provides more flexibility. Current projections, according to the Global Interconnection Index are that:
- Private interconnection is expected to exceed public interconnection activity.
- Latin America is leading the way in interconnection bandwidth.
- The insurance and banking industries are expected to lead the way among various industries in interconnection bandwidth due to increased demand for consumer services, increased compliance requirements, and changes in digital currency.
- Private cloud connectivity, among multiple clouds, is expected to increase 160% by 2020.
- Interconnection bandwidth is expected to grow for private data exchange networks ten times faster than for MPLS networks.
Reasons interconnections are increasing
Some of the current trends causing increased global interconnectivity are:
- Digital technology. Use of digital technology which requires real-time interactions which, in turn, requires more connectivity.
- Urbanization. As populations continue to expand, over two billion people are estimated to move to major cities by 2035, necessitating dense interconnection needs.
- Data sovereignty. This means data can be accessed locally even though it can be used worldwide. Many countries already limit the transmission of financial, tax, and accounting data.
- Cybersecurity. Sending data through private traffic exchanges should be more secure than transmitting the data through public networks.
- Globalization. As companies continue to send and receive products and services across country borders, the need for connectivity will expand.
Businesses and organizations need to understand where their growth opportunities are by preparing technically for the future – as well as financially, culturally, and legally. Companies need to be able to scale their connections as their need for connectivity expands to different geographical regions and as their services and products become more digitally desirable.
