Rapid interconnectivity growth will add complexity and risk

Recent geopolitical concerns, predictions of a looming recession, and continued supply chain difficulties are unlikely to dampen growth in digital bandwidth on private networks according to Equinix’s 2022 Global Interconnection Index (GXI). Global interconnection bandwidth (the volume of data exchanged between companies directly, bypassing the public internet) is a barometer for digital infrastructure and sheds light on the difference in dynamics between verticals. High growth in private interconnection is a boon for Equinix as the world’s largest colocation provider by market share but makes resiliency more challenging for its customers: all these interconnects are also potential points of failure.

The Equinix GXI projects strong growth across the industry in 2023, with global interconnection bandwidth projected to increase by 41% compared to 2022. Overall, global interconnection bandwidth is projected to grow by a compound annual growth rate (CAGR) of 40% into 2025, when it is expected to reach nearly 28,000 terabits per second (tbps). These numbers include direct connections between enterprises and their digital business partners (such as telecommunications, cloud, edge, and software as a service (SaaS) providers).