Digital business expansion, global data flows and trade, and a growing number of data compliance regulations have become powerful catalysts for Interconnection growth in Europe. As a result, companies can now interconnect in ways they simply couldn’t before. This is driving substantial change across the European Union (EU), which represents the second-largest economy in the world behind the United States. In 2017, Trading Economics reported that the EU’s gross domestic product (GDP) was more than $17.277 billion, representing 28.87% of the world’s economy.
The second volume of the Global Interconnection Index (GXI) is a market study recently published by Equinix that analyzes private traffic exchange globally and charts the way in which digital business is changing. Between 2017-2021, the GXI projects a 48% compound annual growth rate (CAGR) in Interconnection Bandwidth, the total capacity provisioned to privately and directly exchange traffic with a diverse set of participants at distributed IT exchange points. Europe is expected to contribute 23% of installed Interconnection Bandwidth capacity globally by 2021, an estimated 1,921 Terabits per second (Tbps).
Regional Growth of Installed Global Interconnection Bandwidth Capacity (2017 – 2021)
Where European enterprises are interconnecting
European businesses work closely with systems integrators, such as Accenture and Orange Business Services, to help them through their digital transformations, and in particular, with their cloud migration. So it is no surprise that the fastest growing ecosystem counterparties that European enterprises are interconnecting with are Cloud & IT Service Providers, at an estimated 98% CAGR. At the same time, two-thirds of the Interconnection Bandwidth in Europe is projected for use by enterprises connecting with Network Providers to better enhance network optimization.
In terms of vertical industry interconnectivity, Telecommunications (430 Tbps) and Cloud & IT Services (314 Tbps) are expected to hold the largest shares (a combined 38%) of the total installed Interconnection Bandwidth capacity in Europe by 2021. The Banking & Insurance (247 Tbps) and Securities & Trading (220 Tbps) sectors are the third- and fourth-largest consumers of Interconnection Bandwidth (see chart below):
Geographic Interconnection and data compliance
The four top European metros — London, Frankfurt, Amsterdam and Paris — are estimated to account for nearly 85% of the total European traffic by 2021, with London at more than 35%. Each of these four cities are expected to outgrow the rest of Europe by at least a 10% CAGR. This accelerated growth demonstrates the global trend of urbanization, which “adds 65 million people to the world’s urban population annually,” according to Global Trends 2030.
One area where Europe is well ahead of the rest of the world is data privacy, which is also driving the need for greater Interconnection. More than 18 major countries block the transfer of data relating to accounting, taxes and other financial information. Reducing risk and meeting country-specific data sovereignty requirements, such as the EU General Data Protection Regulation means ensuring that businesses can integrate local data security controls and access to security ecosystems via direct and private Interconnection from anywhere, at any time.
Interconnection: A catalyst for digital transformation
Interconnection on Platform Equinix®has been the catalyst for many European-based companies’ digital transformations. For example, Coca-Cola European Partners(CCEP) serves 300 million consumers across 13 countries, shipping 2.5 billion cases of drinks annually. CCEP was formed from the merger of three Coca-Cola bottlers, where one, Coca Cola Enterprises (CCE), had adopted an interconnected cloud strategy with the purpose of driving efficiencies across the business. By leveraging Interconnection Oriented Architecture® (IOA®) best practices deployed on Platform Equinix, CCE re-architected for a digital edge and is now more connected, more secure and more responsive. “One of the advantages of working with Equinix is that we’re operating on a common platform within a vibrant ecosystem,” said, Robin Ford, senior manager, Cloud Services, CCE. “We’re connected to lots of other companies who share the same thinking.”
Dublin-based unified communications provider Blueface wanted to rapidly expand its services into France, Germany, Italy, Spain, the U.K. and the U.S. By leveraging IOA best practices deployed on Platform Equinix, Blueface optimized multicloud connectivity via the Equinix Cloud Exchange Fabric™ (ECX Fabric™) and boosted performance. With this approach, the company seamlessly, efficiently and securely integrated its data at the digital edge — close to its users. Nearly 98% of Blueface’s traffic is now run through Equinix, using direct connections with other carriers within Equinix International Business Exchange™ (IBX®) locations. According to Nameer Kazzaz, network operations commander, Blueface, “As a unified communications provider for business customers, Interconnection is an absolute must. We wouldn’t enter a new market without an Interconnection-first strategy.”
As the cloud becomes increasingly important to the media and entertainment industry, so does Interconnection, which enables content delivery management companies to get close to distributed customers in markets all over the world and reliably deliver high-quality content. BASE Media Cloud is offering dedicated services in the media and entertainment sector by leveraging Interconnection to multiple private and public clouds, as well as multiple connectivity providers via Platform Equinix. Base Media Cloud hosts its centralized cloud storage infrastructure and cloud gateway network with Equinix, and interconnects to a multitude of public cloud and media SaaS partners via the ECX Fabric to provide them with a single pane of glass user experience. Since the latest iteration of the BASE Media Cloud platform went live at an Equinix London IBX in January 2018, the company had already ingested more than 2 Petabytes of customer data and delivered hundreds of Terabytes of HD Broadcast long-form materials to more than 500 global media companies. “BASE Media Cloud has continued to grow rapidly on Equinix’s Interconnection platform,” said Damon Neale, CTO, BASE Media Cloud. “By choosing to do business on Platform Equinix, we have been able to flexibly add both direct connects and carrier-grade internet bandwidth, on demand, to deal with the explosive video data growth of our global clients.”
Europe’s economic future holds a wealth of new growth opportunities. With our worldwide Interconnection capabilities and globally consistent colocation platform in 200 global IBX data centers in 24 countries on five continents, we will be there to help power the digital transformation of European businesses that want to reach anywhere, connect anyone and integrate anything.
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