Why Cloud Adjacency Is the New On-Premises Strategy

Deploying infrastructure adjacent to cloud services can help maximize agility, unlock new use cases and keep data secure and private

Jed Bleess
Why Cloud Adjacency Is the New On-Premises Strategy

The impetus for greater hybrid multicloud adoption is clear: organizations must have the flexibility to place their workloads wherever they can be scaled and managed most efficiently. Many organizations are migrating some workloads to the public cloud to take advantage of clear performance and agility benefits, while leaving other workloads on-premises for security or data privacy reasons.

However, digital leaders are rethinking the on-premises portion of this equation. According to the Global Interconnection Index (GXI) 2023,  businesses are interconnecting their digital core to remove the limitations of legacy siloed IT systems. Essentially, they are reimaging their traditional on-premises systems as cloud-adjacent architectures.

Cloud adjacency is the next step in the evolution of hybrid multicloud. A common myth is that the value of cloud-adjacent data is limited to traditional organizations that are not able to fully move to cloud. In reality, all types of leading organizations are adopting cloud adjacency. Many cloud-native companies have discovered that apps that require access to large data repositories, need exponential scalability or have been highly customized are more effective in a cloud-adjacent architecture. A cloud-only approach limits their ability to exchange data across their partner ecosystem without incurring unacceptable data egress fees. As a result, many of these cloud-native organizations are repatriating some workloads from public clouds to cloud-adjacent architectures.

Instead of connecting cloud workloads with traditional on-premises workloads via a WAN or the public internet—with all its security and performance issues—enterprises are placing their digital infrastructure in colocation centers. These facilities are also home to cloud on-ramps to leading IaaS and SaaS providers, B2B partners, and even customers. This allows organizations to bring their core applications directly adjacent to the cloud and their partner ecosystem, so that they can leverage software-defined interconnection and on-demand capacity for their next-generation digital services.

More enterprises are standardizing on cloud adjacency because it can help increase infrastructure agility, reduce latency, and keep sensitive personal data private and secure. In short, a cloud-adjacent architecture helps businesses create a hybrid multicloud environment that capitalizes on the best of each element, truly delivering on the promise of hybrid.

GXI data shows cloud adjacency is the future

Data from the GXI Vol. 5 shows what the growth of cloud adjacency looks like: Service Providers—including cloud providers—make up 64% of the total mix for global interconnection bandwidth, compared with only 36% for Enterprises. The data also shows that Service Providers are digitally mature and expanding their infrastructure in a distributed manner: the average Service Provider deploys across eight core metros and eight edge metros. This fact demonstrates that they recognize the need to expand their reach to meet Enterprise customers where they are.

Enterprises are also expanding across core and edge locations to enable cloud adjacency. In fact, the data shows Enterprises will grow interconnection bandwidth slightly faster than their Service Provider counterparts—46% CAGR by 2024, compared to 44% for Service Providers. However, the GXI also states that over time, Enterprises will grow their preference for as a Service offerings, leading infrastructure growth to be reflected more on the Service Provider side.

Maximizing infrastructure agility with temporary cloud capacity on demand

Among the key limitations of traditional on-premises infrastructure are the high costs and long lead times needed to stand up physical hardware. In the digital economy, where adapting quickly is one of the key criteria for success, businesses that can’t scale capacity on demand will get left in the dust.

Deploying adjacent to the cloud helps address this issue any time an unexpected traffic spike overwhelms reserved capacity within the data center. Enterprises can use load balancing solutions from leading cloud providers to spread traffic across on-premises servers and virtual server instances that can be added or removed as demand fluctuates. Crucially, the virtual instances are connected to the on-premises infrastructure via secure, private interconnection, allowing them to function as a logical, albeit temporary, part of that infrastructure.

Unlocking advanced use cases with low-latency connections

The exciting possibilities of next-generation technologies like 5G wireless and the Internet of Things are another key reason cloud adjacency is more attractive than ever. These technologies are driving ever-lower latency caps, so it no longer makes sense for enterprises to operate traditional on-premises infrastructure that can’t connect with cloud services quickly and easily.

Enterprises used to achieve “good enough” latency results despite routing workloads through core hubs that were often hundreds of miles away. With use cases that require latency of less than 10 ms becoming more common, this is no longer tenable. Keeping workloads proximate to infrastructure is the only way to reliably keep latency low.

Use cases like smart manufacturing and connected vehicles use specialized hardware that typically wouldn’t be offered by cloud providers—such as sensors, cameras and robotic equipment—but can still benefit from the performance and flexibility benefits of cloud services. For this reason, these use cases are a particularly good fit for cloud adjacency: it allows enterprises to capture the data they need and put it into use quickly, without latency standing in the way.

Keeping data private and secure

The digital world is increasingly global, populated by Enterprises and Service Providers that operate worldwide. Governments are eager to prove they can keep citizens’ data private and secure in a world where national borders are increasingly blurry; as a result, countries across the world are stepping up data privacy regulations.

Once again, cloud adjacency is the key: companies get the in-country physical infrastructure they need to satisfy regulators. They can also take advantage of cloud services without sending data out of country or exposing it to risk. Only data that needs to be moved to support a particular cloud workload will be moved, and any data that does pass to the cloud will do so over private, secure interconnection.

Equinix helps customers deploy cloud-adjacent architectures

As the world’s digital infrastructure company™, Equinix is uniquely positioned to help our customers capitalize on cloud-adjacent architectures. With Platform Equinix®, digital leaders can deploy in the right places, connect with the right partners, and unlock the right possibilities.

There are more than 240 Equinix International Business Exchange™ (IBX®) data centers across 65 metros, 27 countries and five continents, so it’s easy to deploy on-premises infrastructure adjacent to the cloud of your choice. In addition, our partner ecosystem includes more than 3,000 cloud and IT services providers, which you can privately connect to using Equinix Fabric® software-defined interconnection. Our global reach and cloud connectivity can help you scale with agility, launch digital services faster, and deliver a better end-user experience.

To learn more about how digital leaders across the world are fueling a cloud-adjacent approach with interconnection, read the GXI 2023 today.

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