What a 190% ROI on Network Modernization Looks Like

Enterprises are moving more data between more distributed endpoints, in more places, than ever before—which makes network modernization essential. Yet many leaders struggle to see an immediate return on that investment. That’s because the benefits are often indirect or qualitative, and measuring them isn’t always straightforward.

The proposals that reach your desk are usually built by people who don’t have full visibility into the cost savings at stake. Instead, they’ll focus on creating an architectural diagram showing all the distributed endpoints and ecosystem partners the company would be able to connect with. But one thing a diagram can’t show is return on investment. And if you’re the one who has to approve it—or live with the consequences of deferring it—a diagram gives you nothing to judge the investment against.

The problem is that there are also costs to doing nothing. When enterprises continue to run legacy physical networks, they’ll experience costs in the form of poor performance, limited flexibility and slow deployment. These costs will compound quickly unless the organization takes action to stop them. Ignore them long enough, and they’ll surface where the business can feel them: stalled AI initiatives, long provisioning backlogs, falling customer satisfaction.

To provide a more complete picture of both the quantitative and qualitative benefits of network modernization, Equinix recently commissioned Forrester Consulting to conduct a new Total Economic Impact™ study. It found that a composite organization realized benefits of $3.1 million over a three-year period by adopting software-defined networking to replace traditional fixed infrastructure. It incurred about $1.1 million in costs over the same period, meaning roughly $2 million in net benefit, or an ROI of 190%.[1]

The Forrester TEI study is based on interviews with four decision-makers who recently adopted software-defined networking within their organizations. The results of those interviews were aggregated to form a single composite organization: an international business operating across North America and Europe with annual revenue of $5 billion and 10,000 employees.

The networking costs that nobody can measure

For us, the study provides economic validation for the argument we’ve been making on this blog over the past several weeks: that flexible virtual networking capabilities are essential to keep up with the rapidly changing world of distributed AI. For instance, we argued that there’s a “coordination tax” involved with not being able to properly connect AI workloads. Now we can finally put a real dollar figure on that tax.

Before their network modernization initiatives, all four respondents reported similar experiences: Using physical infrastructure, they were unable to provision networks quickly enough to meet the emerging demands of their business. They struggled with managing connectivity across multiple providers and technologies, leading to performance issues and regulatory risk. They also worried that their current rigid cost structure would leave them unable to adapt their networks to meet their future needs.

These are the costs of outdated infrastructure: delay and risk that never show up as a hard number on an executive dashboard. Despite this, the respondents all realized that they needed software-defined networking to help ensure better results for the business.

What the Forrester study actually measured

The study included the following quantified benefits for the composite organization over a three-year period:

• $360,000 saved in infrastructure administration costs due to replacing manual procurement and implementation with on-demand virtual provisioning
• $1.5 million saved by replacing traditional MPLS connections with virtual connections that can scale more cost-effectively to provide higher bandwidth for AI initiatives
• $1.1 million saved thanks to software-defined networking solutions that can dynamically scale up or down to meet changing demand, instead of deploying excess physical network capacity to accommodate peak demand at all times
• $174,000 saved using private traffic exchange to avoid egress expenses commonly found in traditional traffic-routing approaches

These numbers are not hypothetical; they’re all based on savings that four real organizations achieved by shifting away from traditional physical network infrastructure.

What the numbers can’t capture

Just like there are unquantified costs involved with traditional networking infrastructure, the interviewees reported unquantified benefits from modernizing their networks. These include:

• Improved business agility thanks to on-demand provisioning and rapid access to clouds, carriers and other service providers
• Better user experience due to meaningful improvements in network performance
• Reduced security, compliance and governance risk by using private connectivity instead of the public internet
• More reliable business operations through improved resiliency and failover capabilities

This shows that the 190% ROI figure is understating the true value that the composite organization achieved through software-defined networking. Although respondents consistently reported the benefits listed above, it wasn’t possible to include them as part of the ROI calculations.

How do costs scale as adoption grows?

The study is based specifically on software-defined networking that’s consumed as a managed service. Therefore, the composite organization experienced no significant implementation or deployment costs.

Instead, costs were driven primarily by networking and service consumption fees. During the three-year period, the composite organization grew its total network connections from 120 to 160 and expanded adoption from 20% to 60%. Costs scaled up as use of the solutions expanded:

• Year 1: $385,000
• Year 2: $440,000
• Year 3: $495,000

However, all four respondents emphasized that increasing costs were offset by the savings they experienced by avoiding the drawbacks of MPLS circuits, manual provisioning and internet egress. These savings scaled along with the network: The more they used the solution, the greater the financial benefits were.

The foundation that enables quantifiable ROI for network modernization

The solutions used by the composite organization were Equinix networking solutions such as Equinix Fabric® for software-defined interconnection, Fabric Cloud Router for flexible cloud-to-cloud routing, and Equinix Network Edge for virtual network devices from top partners.

These solutions all provide the software-defined connectivity foundation for Equinix® Connected Cloud, enabling organizations to connect clouds, AI providers, enterprise partners, and distributed environments on demand.

Recently, we announced two new solutions that continue to build upon this same connectivity foundation:

• Equinix® Fabric One™ is a managed connectivity service that designs, optimizes and maintains the network for you, so that connecting a new site, cloud or partner doesn’t require added headcount or a re-architecture.
• Equinix® Inference Exchange lets you stand up AI compute from leading providers in days rather than months, pre-connected to the clouds and AI platforms your teams already use.

The value of the Equinix networking foundation has been demonstrated with three years of real financial results. These new solutions represent the next chapter of that foundation, as we continue to bring our customers the capabilities they need to keep up in a changing world.

Making the case for better networking solutions

Highlighting the qualitative benefits of network modernization has always been the easy part. Making a financial case was more difficult. Business outcomes like AI readiness, agility and scalability all matter, but they don’t always move decision-makers focused on the bottom line.

Now, there’s an independently audited number to show that virtual networking isn’t just a good decision; it’s a financially sound one. That makes saying “yes” to network modernization a defensible financial decision, not a leap of faith.

To learn more, read the full Forrester study: “The Total Economic Impact™ Of Equinix Networking Solutions.” 

[1] The Total Economic Impact™ Of Equinix Networking Solutions, A Forrester Total Economic Impact study commissioned by Equinix, September 2026.