The Bottom-Line Value of Becoming an Interconnected Enterprise

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It’s clear that interconnection is critical to today’s enterprises. According to a recent Enterprise of the Future survey of 1,000 global decision-makers by Equinix, 3-in-5 businesses believe that direct and secure interconnection with employees, partners and customers is “very important” to their company’s ability to compete. But can the monetary value of an enterprise interconnection strategy be quantified in real and substantial ways? The answer is yes.

The results of the Enterprise of the Future survey revealed that more than 1/3 of survey respondents who have already deployed interconnection solutions reported greater than $10 million in value created. A closer look at this finding showed that 24% of interconnected enterprises realized between $10M and $20M in value, and 13% realized more than $20M. 58% of the survey’s respondents said this value was generated by increased revenue opportunities, while 42% achieved it through cost savings.

A recent Forrester report also shows compelling evidence of the economic value of interconnection. “The Total Economic Impact™ of Equinix Interconnection Solutions” found that enterprises can anticipate a 300% return on investment (ROI) from the accumulated benefits of interconnection solutions. This reflects the combined value impact of the new revenue opportunities and cost savings interconnection generates. For example in the Forrester report, an enterprise generated millions in incremental revenue by more quickly and easily launching new products to customers via secure, high-speed provider connections near large user bases. In addition, more proximate interconnections between the organization and its employees, partners and customers contributed directly to a 40% reduction in bandwidth costs.

The Forrester report illustrates how interconnection can drive new enterprise revenue opportunities in a variety of dynamic ways, including the:

  • Ability to leverage big data analytics to gain better insights into customer requirements and evolving market trends, which can drive new revenue streams and advance product innovation.
  • Interconnection to worldwide ecosystems of network service providers accelerates new growth opportunities via greater global reach and more competitive pricing.
  • Opportunity to forge direct and secure connections to large concentrations of users, business partners and cloud providers for more efficient and effective interactions, collaboration and access to new services for faster product introduction.
  • Ability to improve reliability and performance consistency, freeing up time and resources otherwise spent troubleshooting problems so it can be re-focused on revenue-generating activities.

When it comes to cost savings from interconnection, it can also come from many places within the enterprise. For instance:

  • Developers save time because they have a simpler, more reliable, more consistent interconnection platform to roll out and run applications.
  • Multiple networks and cloud services can be provisioned in days versus months, with less work needed to do the physical connectivity necessary for new deployments.
  • Placing IT infrastructures and services closer to users and connecting to more efficient networks reduces latency, improving the performance of frequently used applications and cutting bandwidth costs.
  • Fewer network disruptions and outages means less time and resources dedicated to resolve problems, while losses in revenue and user confidence are avoided.

Given the benefits from interconnection, it’s no wonder that 84% of the enterprises that participated in the Enterprise of the Future survey reported that they expect to be interconnected by 2017, which is double the number of interconnected enterprises today.

Download the full report to learn more about the results of the Equinix Enterprise of the Future survey and its economic, business and IT benefits.