Whether it’s the metaverse, self-driving cars or quantum computing, technologies that once seemed like science fiction are now happening in front of our eyes. Businesses need a strong digital strategy to truly capitalize on these technologies. This means building a distributed digital infrastructure that can scale in the right places, connect to the right partners, and unlock the right possibilities.
The Global Interconnection Index (GXI) Volume 5 uses interconnection bandwidth data to show how Enterprises and Service Providers across the world are doing just that. According to the GXI, companies that have optimized their digital infrastructure are now using it as a source of competitive advantage and resilience: in the wake of disruption caused by the COVID-19 pandemic, digital leaders moved 4.5x farther ahead, while traditional businesses were still trying to get their bearings.
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!
The GXI report separates the digital infrastructure imperative into three components:
- Digital core: Corporate network, multicloud and regional back-end data infrastructure locations.
- Digital ecosystems: Locations close to specific digital marketplaces where businesses can access new capabilities and services.
- Digital edge: Locations close to front-end centers of revenue and operations and high concentrations of end users.
GXI data shows that edge locations are growing interconnection bandwidth much faster than core locations. For Enterprises, interconnection bandwidth in edge metros will grow 57% CAGR by 2024, compared to only 29% for core metros. This shows that Enterprises are emphasizing distributed infrastructure much more than they have in the past.
This is not to say the edge is more important than the core for organizations building out their digital infrastructure; the core and the edge each play different, yet equally important, roles within an effective digital-first strategy.
What is a core metro?
According to the GXI, core metros are those that are primarily used to provision capacity between networks, clouds, XaaS providers and businesses. Interconnection bandwidth is still growing in these locations, just not as quickly as it is in edge metros. Organizations have less need to deploy new digital infrastructure in core locations because they’re often already deployed there.
What’s changing is how organizations are using infrastructure at the digital core. Gone are the days of siloed IT hubs sitting at the center of all systems and transactions. Digital core locations remain home to on-premises infrastructure—often to store data with special security or regulatory requirements—but these systems are now more likely to be cloud adjacent. This means they’re proximate to cloud on-ramps, allowing organizations to tap into cloud services and capacity on demand. The new digital core is just one part of a distributed, interconnected infrastructure spanning the globe, rather than being the bottleneck at the center of everything.
Core metro examples
Due to its leading position in financial services and other industries, New York has the largest interconnection bandwidth of any metro in the world. Enterprise use cases requiring access to business partners—such as electronic trading—account for most of the interconnection mix, while cloud and network access account for less. While it will grow relatively slowly (40% CAGR), New York is still forecast to be the largest interconnection bandwidth metro in 2024.
London is the de facto interconnection hub of Europe; like New York, it is an important site for securities and trading ecosystems. The English Channel separating the U.K. and France was the site of the first subsea telegraph cable. Demand for connectivity between the U.K. and mainland Europe remains high today, with the CrossChannel cable going live in 2021 to help service that demand. Across the channel, Paris is growing interconnection bandwidth the fastest among European core metros, thanks to its thriving transportation and energy ecosystems.
Singapore has emerged as a digital exchange hub, with the largest forecast in Asia for interconnection bandwidth growth from cloud and IT service providers. This growth will be driven by the city-state’s strong digital connectivity, deep talent pools, and proximity to emerging markets. Despite a lack of developable land, Singapore tied for second in the 2022 Global Data Center Market Comparison from Cushman & Wakefield. This means the metro was highly ranked across criteria including fiber connectivity, market size and cloud availability.
What is an edge metro?
An edge metro is any location that’s traditionally been used for front-end transactions like connecting with end users, devices and local markets. Essentially, they bridge the gap between the digital and physical worlds. What makes an edge metro isn’t necessarily about population size or economic strength; it’s about why businesses are expanding in those metros, and what role those metros play in their digital business strategy.
Organizations are deploying in edge locations because that’s where the growth opportunity is. Many groundbreaking technologies depend on collecting and processing data with extremely low latency to enable real-time communication with various applications at the edge. No matter how fast data moves, physical distance inevitably leads to latency. The only way to keep latency low is to perform key functions in proximity to end users, thereby reducing the distance data has to move. Cloud services are limited at the edge, but they’re growing quickly because Enterprises can no longer afford to route cloud traffic through core locations hundreds of miles away from end users and devices.
Edge metro examples
Los Angeles’ bandwidth mix is typical of edge metros, in that it’s driven primarily by network access. This stands to reason, as the city is a landing site for subsea cables from Asia and Latin America. Los Angeles is forecast to grow interconnection bandwidth quickly: 51% CAGR by 2024, much faster than core U.S. metros like New York.
In Europe, Madrid and Barcelona are both growing interconnection bandwidth quickly. This is thanks to a strong network presence created by Spain’s proximity to Africa and transatlantic subsea cable landing sites. Dubai is emerging both as a connection point between Asia and Europe, and an aggregation point for businesses operating locally within the Middle East; it’s no surprise the GXI forecasted it to be the fastest-growing interconnection bandwidth metro in the world.
In Asia, edge metros like Shanghai and Beijing are growing networks and clouds quickly, to the point they will soon rival core locations for ecosystem density. By 2024, interconnection bandwidth in these metros will surpass that of core metros like Hong Kong, driven mainly by network growth.
Take the next step in your digital journey
Understanding what core and edge metros are and what role each plays in the development of digital-first strategies is an important first step toward preparing for success in a digital world. To learn what comes next, read the GXI Vol. 5. You’ll get data-driven insights about how leading Enterprises and Service Providers are using interconnection to enable flexible, distributed digital infrastructure on a global scale.
 Cushman & Wakefield, “Global Data Center Market Comparison”. Kevin Imboden, January 2022.