The 4 Ps of Digital Transformation

In a digital-first economy, network service providers (NSPs) play a key role in helping their enterprise customers thrive. In fact, the Leader’s Guide to Digital Infrastructure from Equinix found that network modernization helped some digital leaders increase bandwidth 10x while cutting both costs and latency in half.

NSPs can enable digital transformation for their customers by helping them select the ideal ports for each use case. Enterprises often feel compelled to default to public ports, due to their wider availability and perceived benefits around costs and complexity. However, with the right approach to digital infrastructure, NSPs can help make private ports just as widely available and easy to use as public ports. This is why we encourage NSPs to consider the 4 Ps of Digital Transformation:

1. Public ports
2. Private ports
3. Performance
4. Parity

If you’re familiar with the 4 Ps of Marketing—product, price, place and promotion—then you know the term is all about taking a fairly complicated topic and making it easier to understand and remember. In the same way, the 4 Ps described in this blog can help you understand the complex role that network modernization plays in digital transformation, and then act accordingly.

Public ports are ubiquitous and cost-effective

As the term suggests, public ports face the internet and are generally accessible to any organization. Furthermore, they’re essentially ubiquitous. All businesses have them, and the general perception is that one public port can quickly and easily be connected to another public port anywhere in the world.

In addition, public ports are widely considered to be more cost-effective than private ports. This is because any time two organizations connect public ports, each party pays only for their own respective port. The connection itself comes at no direct cost to either party.

Private ports have key benefits, but can also be complex and expensive

Private ports establish dedicated links between partners, using interconnection services rather than the public internet. They are typically owned by larger organizations looking to create secure, predictable performance, with greater control over the implementation, operation and administration of their network.

While private ports are generally more expensive than public ports, some organizations are willing to accept the higher cost to gain the features and functions not found in public ports. In addition, private ports aren’t as widely available as public ports, meaning that you can’t assume you’ll be able to connect with the partners you want, where you want. Even when you do find a private port in the right location, establishing the connection won’t be nearly as straightforward as it would be over the public internet.

Performance comes at a price

For the purposes of this discussion, “performance” is a measure of the underlying features and functions that ports offer (or don’t offer), and how they translate to network speed, security and reliability. Most organizations assume port performance is directly linked to costs, which makes sense given everything we’ve learned so far. It’s true that private ports are generally more expensive than public ports, but they also come with higher built-in performance.

It’s important to consider performance in terms of value for money. Public ports are only the most cost-effective option if you truly don’t need the features and functions built into private ports. If you have to manually add them after the fact—essentially, bringing your public ports up to the same level of performance as private ports—then whatever cost advantages you may have initially enjoyed will start to evaporate quickly.

Parity requires balancing performance, complexity, costs and availability

Enterprises would ideally use a mix of public and private ports in their network architectures. However, for reasons we’ve discussed in this blog, they tend to favor public ports over private ports. Parity is the idea of doing away with this preference for public ports, letting organizations select the right port for the right use case without consideration for which option is cheaper or easier.

The market is working to establish parity through fortifications and enhancements that help public ports emulate the performance benefits of private ports. As mentioned earlier, these improvements don’t come cheap. In addition, they erode some of the simplicity benefits public ports are known for.

There’s also a bigger issue that typically doesn’t come up in discussions of port parity: the assumption of availability. Public ports are more widely used today simply because they’re more widely available, and because organizations assume any public port they own can easily connect to any public port their partners own, anywhere in the world.

They can’t make the same assumptions about private ports located on different networks. Establishing A-side to Z-side connectivity via private interconnection can be more complex and time-consuming than it is via the public internet. This Z-side connectivity problem is one of the main challenges standing in the way of true port parity.

How NSPs and enterprises can help establish parity

NSPs can enable port parity by making private ports as ubiquitous as public ports. They can do this by establishing network-to-network interfaces (NNIs) across their partner ecosystem. A neutral, third-party platform like Equinix Fabric™ makes it quicker and easier to set new NNIs in different locations around the world, compared to the traditional process of setting NNIs via physical cross connect. With Equinix Fabric for NNIs, NSPs can create network agility and cost benefits, which they can pass on to their enterprise customers.

From the enterprise perspective, port parity is about selecting the right service providers—the ones that have the right network assets in the right places. Enterprises must also think carefully about how they use the unique capabilities of their ports, and only pay extra for those capabilities when it makes sense to do so. This allows enterprises to balance the economics of their ports, optimizing their price per bit.

Equinix enables the 4 Ps of Digital Transformation

Platform Equinix® is home to innovative digital services, a global colocation footprint, and an unmatched digital ecosystem of partners and service providers. It provides everything NSPs and their enterprise customers need to optimize public and private ports in pursuit of digital transformation.

Equinix Fabric is the traffic intersect point for private ports, and it’s the only software-defined interconnection service that can help NSPs quickly expand private port availability across the globe. In addition, Equinix Fabric makes it simple to establish private interconnection between two Equinix IBX® data centers, effectively solving for the Z-side connectivity problem. With wider availability and reduced complexity, enterprises are free to use private ports when and where it makes sense for them to do so.

With internet routing and peering services such as Equinix Internet Exchange®, Platform Equinix is also the traffic intersect point for public ports. Equinix Internet Exchange is the peering platform trusted by more than 1,500 organizations worldwide. It offers the flexibility to aggregate traffic from multiple peers on a single port, the performance benefits of fewer network hops and reduced congestion, and hands-on control enabled by a globally consistent management portal.

To learn more about how Equinix digital services can help NSPs, read the white paper “Create digital advantage at software speed.” You’ll get a closer look at how service providers can tap into strategic partnerships to gain the flexibility and agility needed to thrive in a digital-first world, complete with use case examples.