Is your company prepared for the growth of the Brazilian data center market in 2020?

In the current technological landscape, global enterprises are migrating at an increasingly faster rate from centralized data centers to a more geographically distributed infrastructure that is closer to the digital edge and to users as well, on par with the intensity already demonstrated in 2019. This refers to the constant digital transformation underway in an IT market that ended 2019 with 1.3% growth in Latin America and is slated to report an upswing of 4.8% in 2020, according to a study by [i]. Specifically in Brazil, investments in 2020 are expected to sit close to USD 48 billion for IT and telecommunication services should see about USD 41 billion.

IDC also predicts that the digital economy will account for more than 50% of the Latin American GDP by 2022. Growth will be driven by improved offerings, transactions, and relationships between enterprises, partners, and customers. Big data and analytics, cloud, mobility, social media and the Internet of Things (IoT) are technologies that require the largest volume of resources to meet market demands.

In addition to investments, there is information management. Digital payments, self-driving cars and smart hospitals, just to name a few, can generate numerous terabytes of data per day, which need to travel securely and quickly.

When opting for interconnection – a private and secure route of data traffic between partners –, enterprises from various industries can respond efficiently to the challenges of digitalization. It’s no coincidence that 76% of IT decision makers interviewed in an independent APCO Insight study commissioned by Equinix named Interconnection as a fundamental facilitator in digital transformation.

To stay competitive, enterprises need IT infrastructures that favor real-time interactions between people, things, locations, clouds, and data, often with multiple partners and in different parts of the world. That is why they are being driven to seek more creative and effective ways to expand digitally, amplifying the need for Interconnection.

The robust expansion in data exchange results in increasing Interconnection Bandwidth. A 63% growth in Latin America’s Compound Annual Growth Rate (CAGR) is expected between 2018 and 2022, according to the 2019 Global Interconnection Index (GXI), an annual study conducted globally by Equinix. Among those surveyed, Latin America is the fastest growing region.

The demand for low latency, high performance and privacy, in addition to a shift towards the new, distributed computing models, will likely accelerate the adoption of data centers located near customers and business partners that can provide them with hybrid multicloud ecosystems.

More Interconnection and data processing capabilities will pave the way for new digital data marketplaces, where data purchasers and providers can perform large-scale transactions easily and securely in data centers located on the edge, with no ties to vendors.

Security will also receive increasing attention in the coming years, regarding both the increase in cyber-attacks and privacy and data protection regulations, or even due to natural disasters. In Brazil, the General Data Protection Act (LGPD) will enter into force in August 2020, and is very similar to the European General Data Protection Regulation (GDPR). We will also see many enterprises migrating their cloud access to private networks and updating their encryption services to extend user data protection.

Get ready for your digital journey with Equinix

With so many changes and transformations, it is essential that companies can count on partners and suppliers that can support them on their journey towards digital transformation and their interconnection and global growth strategies. All of these requirements, added to the growing need for space and energy, and access to more flexible and affordable on-demand services, drive the growth of colocation and interconnection services in Brazil and worldwide.

In its first edition, the report IDC MarketScape: Worldwide Colocation and Interconnection Services 2019 -2020 Vendor Assessment [ii], recognizes Equinix as a Leader in colocation and interconnection services worldwide. According to the report, Equinix is a supplier that “has evolved steadily over the past two decades to become a global datacenter powerhouse”.

Among the highlights presented in the study are Equinix’s innovative services and ecosystems, which facilitate digital transactions closer to the edge, and the inherent value of our platform compared to what is offered by the competition, worldwide. Equinix’s investment and innovation strategy employs “a solid investment strategy and a proven record of innovation”, according to IDC MarketScape. The IDC MarketScape also stated, “Equinix is also a leader in leveraging sustainable and renewable energy sources. Equinix was the first datacenter company to publish a comprehensive ESG sustainability report and has also established a goal of implementing 100% renewable energy. The company is also an early adopter of the VPPA approach to the acquisition of large-scale renewable energy and regularly reports on its sustainability efforts and achievements.”

According to the report, companies should consider Equinix when “You are a global enterprise or service provider that needs to remove the distance between your users, cloud services, ecosystem partners, and customers across your edge to meet the high-performance and low-latency demands of digital. As you transform your architecture to become digital ready, consider Equinix when you are optimizing the network to reduce costs and improve scale across strategic locations, simplifying hybrid multicloud access, distributing security controls to manage risk, or distributing data and analytics to optimize edge computing needs. You require a high-availability and scalable platform by a company that is also deeply devoted to sustainability.”

To learn more about why Equinix was recognized as a leader and how we can support companies on their journey towards digital transformation, read the report IDC MarketScape: Worldwide Colocation and Interconnection Services 2019- 2020 Vendor Assessment. 

[i] Latin American IT market should end 2019 with 1.3% growth and 4.8% increase in 2020, according to IDC, December 2019.

[ii] IDC MarketScape: Worldwide Colocation and Interconnection Services 2019- 2020 Vendor Assessment, by Courtney Munroe, December 2019, IDC #US45717419.