To Find the Cloud’s Future, Look Backward

Jim Poole is vice president of global service provider marketing at Equinix.

A theme emerges when some of history’s great thinkers consider what the past has to say about the future.

“What’s past is prologue,” Shakespeare wrote. “Study the past, if you would divine the future,” Confucius advised. “History doesn’t repeat itself,” Mark Twain said, “but it does rhyme.”

The idea that what’s behind holds clues about what’s ahead survives because there’s truth to it. I believe it’s spot on when it comes to the growth of digital industries – sectors where information and communications technologies play a big role in creating or generating value.

The past has seen digital industries follow similar growth trajectories. That’s apparent with a glance at how they’ve evolved over time in data centers. As the cloud emerges as the next major growth area, data centers can offer a window into the industry’s future.

Virtually all digital traffic (98.4%, according to Cisco) travels through a data center. And a growing percentage of servers – nearly half by 2017, according to IDC – are in the multi-tenant data centers like those run by Equinix, where I work. Multi-tenant data centers host a variety of business and the ecosystems they interconnect in, not just the IT equipment of one particular enterprise. That diversity means that analyzing what’s happening inside a multi-tenant data center can provide insight into broader business trends.

I’d argue that what you see inside Equinix is richer and more representative than anywhere else, because we house triple the companies and interconnections as our closest competitor. I believe Equinix’s past, and its present, strongly signals the success ahead for the cloud and the other digital industries inside it.

First, the past. Equinix’s legacy since our 1998 founding is as a neutral connection point, which has helped attract more than 950 networks to our facilities.

We began by connecting networks to each other, particularly ISPs. As the Internet expanded, we became a leader in providing networks with neutral peering points, where they could interconnect and exchange traffic. We then extended our network peering services to digital content providers, including Facebook, Netflix, Pandora, and other companies everyone’s heard of. We also fostered significant growth for network services in the financial services and enterprise arenas.

In short, we’ve been connecting networks to the “next big thing” for as long as we’ve been there to do it. The next big thing is cloud. Why would 16 years of shared success with network service providers suddenly stop in the cloud? It won’t, and it definitely hasn’t yet. In the past three years, we’ve seen 150% growth in Infrastructure as a Service (IaaS) and 110% growth in Software as a Service inside Equinix.

Today, Equinix houses 450 cloud providers, several times more than other data center platforms, giving us by far the broadest base of customers for network providers.

We estimate there’s currently a $1.4 billion total market for network service providers connecting cloud services inside Equinix. And we think there’s $28.4 billion worth of cloud services flowing through Equinix right now, if you look at the total value of the connectivity we’ve enabled.

Further, a report by Synergy Research spotlighted the top five players in the IaaS/Platform as a Service cloud market and all five are Equinix customers (including Amazon, Microsoft, Salesforce.com and IBM). We house several of the sites where these companies’ cloud platforms live and host a good portion of the traffic that accesses them.

So the cloud has been constructed inside Equinix and it thrives there now. The legacy of a successful past is the successful present, and that makes me optimistic about Equinix’s future – and the entire digital industry’s. But that future hasn’t arrived yet. To ensure it does, this advice from another famous thinker, William Jennings Bryan, seems sound:

“Destiny is no matter of chance. It is a matter of choice,” he said. “It is not a thing to be waited for, it is a thing to be achieved.”