Digital-First vs. Cloud-First

GXI Vol. 5 reveals why cloudifying business as usual is not enough

Steve Madden
Digital-First vs. Cloud-First

Over the last two years, the pandemic has forced businesses to digitize their business models, increasing the demand for digital services. According to the Equinix 2020-2021 Tech Trends Survey (GTTS), 47% of IT decision-makers globally reported they accelerated digital transformation plans because of the pandemic.

Digital leaders worldwide who were prepared to implement digital-first strategies did, in a matter of months, what may have taken years to achieve in more usual business settings—even with implementing cloud-first strategies. In fact, Enterprise and Service Provider digital leaders who implemented digital-first strategies are now moving 4.5x farther ahead in their transformation, according to the Global Interconnection Index (GXI) Volume 5 report, an annual market study published by Equinix.

The time for a digital-first strategy is now.

The Global Interconnection Index (GXI) is the industry’s leading source of data and insight on interconnection and its increasing impact on the digital world.

Get The GXI Report!

Why cloudifying business as usual is not enough

A cloud-first strategy focuses on the transformation of technology that serves existing business processes. While an important step, a cloud-first strategy is not enough to compete and lead in a digital world.

A digital-first strategy uses technology to transform business processes. The lines of digital business and technology strategies intersect to close organization performance gaps, expand opportunity and gain material returns on digital transformation efforts. Whether a business is committed to staying out front or fighting for market survival, everyone needs to advance from a cloud-first strategy to a digital-first strategy now.

The GXI Vol. 5 reveals how organizations are developing their digital-first strategies

According to the GXI, the digital economy continues to drive worldwide interconnection bandwidth,[i] which is forecast to grow at a compound annual growth rate (CAGR) of 44% by 2024, or 4x the 2020 global total. In fact, interconnection bandwidth is forecast to be 15x larger than the internet!

As the industry’s leading source of data and insight on interconnection bandwidth capacity growth, the GXI Vol. 5 shows how Enterprises and Service Providers are using interconnection bandwidth and distributed infrastructure to shape and scale the global digital economy.

Three macro trends are driving a digital-first strategy

The GXI Vol. 5 explains the macro trends shaping digital transformation and outlines the strategies that digital leaders are following to become digital-first. This includes details—by industry and geography—on the size and growth rate of digital deployment activity that can inform any organization’s digital-first strategy.

The following three macro trends are reflected in the data and observed strategies of digital leaders:

  • Enabling digital services: The GXI shows a 3x increase in the multicloud, multiregional adoption rate over the last two years as businesses scale the digital core.
  • Expanding digital participation: The GXI shows SaaS is now the largest IT spend line item as companies move to public and private aaS alternatives.
  • Achieving digital proximity: The GXI shows digital leaders have more than doubled their rate of digital edge expansion over the last few years.

A digital-first strategy requires digital infrastructure

A digital-first strategy incorporates three key components of digital infrastructure for success: digital core, digital ecosystems and digital edge.

  • The digital core is where organizations establish the foundation for their digital platform. The GXI shows that the digital core encompasses 20% of the global locations, with 70% of both the interconnection bandwidth and digital infrastructure capacity.
  • Digital ecosystems are where organizations participate in the digital economy. The GXI shows that globally, Service Providers interconnect on average with over 100 discrete partners.
  • The digital edge is where an organization’s digital presence meets the physical world, enabling local proximity to customers, employees, endpoints and intelligent operations. The GXI shows that the digital edge encompasses 80% of the global locations, with ~30% of infrastructure deployments and interconnection bandwidth.

Finally, digital infrastructure requires Interconnection Oriented Architecture® (IOA®) which removes the distance between connected things and directly interconnects services in proximity to optimize bi-directional traffic exchange—uploads and downloads.

Service Providers lead the way for Enterprise digital transformation

The GXI forecast reveals that overall, Service Providers will consume 64% of global interconnection bandwidth (13,794 Tbps) by 2024, with Network Service Providers alone making up 32% of the global mix. Deployment benchmarking shows an explosive expansion to the edge by Service Providers—almost double the growth of core—as they helped Enterprises to also expand to the edge (57% CAGR).

Financial Services ecosystem leads global Enterprise interconnection bandwidth growth

Financial Services is anticipated to make up 50%+ of the Enterprise interconnection bandwidth or 18% of the global capacity due to the increase in global e-commerce and digital payments during the pandemic. Manufacturing is estimated to become the largest non-financial services leader, as it rapidly moves to digitize logistics and supply chain business models.

Americas, Asia-Pacific and EMEA regions show distinctly different growth and maturity metrics

The GXI Vol. 5 presents the five-year forecasted annual growth of interconnection bandwidth by region, across core and edge metros, industry verticals and the mix of business partners, clouds and networks. This data presents a diverse view of the regional trends, which are detailed in associated GXI regional blogs:

  • The Americas is the largest region globally, contributing 47% of interconnection bandwidth, and is expected to grow at a 43% CAGR to reach 10,156+ Tbps by 2024.
  • The Asia-Pacific (APAC) region is expected to grow at a 46% CAGR by 2024, making up 28% of global interconnection bandwidth.
  • The Europe, Middle East and Africa (EMEA) region is expected to grow at a 46% CAGR by 2024, contributing 5,327 Tbps to make up 25% of global interconnection bandwidth.

Digital leaders that took the leap

The following Enterprise and Service Provider leaders took the leap to advance their digital strategies, either prior to or during the ongoing pandemic, and saw the following results:

CDW: Managed service provider CDW has been a lifeline to many enterprises on Platform Equinix®. CDW understands the challenges of remote workers because they put the infrastructure in place to support their telecommuting employees and the employees of their global customers. And they are successfully doing it on Platform Equinix by working closely with another important Equinix partner, Cisco®.

Catchpoint: The Catchpoint Digital Experience Monitoring platform rapidly provides IT Operations and DevOps teams deep insight into modern application performance issues before they impact a user’s experience. In addition to Catchpoint being an Equinix Metal™ customer, the Equinix Metal Team uses Catchpoint and the data it provides as a tool to help our customers better learn and understand how the internet works.

We are in the internet's third act, where proximity and low latency unlock a new wave of innovation. As a long-time Equinix customer, we leverage infrastructure in many data centers around the world to deliver holistic and proactive digital experience monitoring capabilities to our global clients. Using critical Catchpoint insights, our customers proactively monitor and optimize the digital experiences of billions of consumers and employees around the world. Equinix Metal lowers our barrier to enter new locations, democratizing access to the edge, and showcases Equinix’s expanding platform vision. We are onboard and planning to roll out across all of Equinix Metal’s 18 new locations.” - Mehdi Daoudi, Co-Founder and CEO, Catchpoint

Make the leap from cloud-first to digital-first

The time to make a bold leap to a digital-first strategy is now. The GXI presents compelling insights on why Enterprise and Service Provider digital leaders in all industries and across multiple metros need to level up from cloud-first to digital-first strategies. Enterprises and Service Providers in any industry or stage of digital maturity can apply the information and guidance shared in the GXI to start or speed their own digital-first journey by:

  • Gaining a valuable view into the macro trends and key benchmarks shaping digital transformation globally, including the industry-wide growth of interconnection bandwidth.
  • Assessing what it looks like to be a digital-first business based on the observed strategies and deployment benchmark data of digital leaders on Platform Equinix so they can map and accelerate their own strategies.
  • Understanding how to design digital infrastructure to solve for the combination of digital core, digital ecosystems and the digital edge so their business can disrupt, not be disrupted.

Leverage the GXI Vol. 5 report to identify the key digital core and edge metros and industry ecosystem deployments that align with your digital maturity level to put your digital-first strategies into motion for greater competitive advantage.

You may also like to read:

GXI Vol. 5 Americas Blog

GXI Vol. 5 Asia-Pacific Blog

GXI Vol. 5 EMEA Blog



[i] Interconnection bandwidth is a measure, calculated in bits/sec, of the capacity provisioned to privately and directly exchange traffic between two parties, inside carrier-neutral colocation data centers.

Subscribe to the Equinix Blog