Understanding Interconnection and Its Business Benefits

Damion Lackamp, Director, Network Products

Why global interconnection is now necessary

For today’s businesses, being connected is not enough. To survive—and to keep customers and internal stakeholders happy and efficient now and in the future—organisations need to promote, manage, curate and champion true interconnectivity.

The world is only getting more interconnected. Businesses that accept this and adapt will be better positioned to thrive. Those that foster strong interconnection strategies will not only enhance operational efficiency but also gain a competitive edge, enabling them to innovate and thrive in the interconnected world of tomorrow.

What is interconnection, and how does it differ from plain old connectivity?

Interconnection is an IT strategy allowing companies to directly, privately, and securely exchange data.

To dive into this, consider what connectivity has looked like for most of human history; whether two people were connecting in a town square or by telephone, communications were tied to a physical place and a finite number of people.

With the evolution of digital technology, interconnection now allows organisations to bypass traditional, centralised communication channels, enabling direct, efficient data exchange across vast networks, regardless of physical location.

In contrast, interconnection involves lots of people collaborating with one another over a thoroughly meshed network via seemingly ubiquitous connectivity. With interconnectivity, everything and everyone is connected with everyone else, and communication (and collaboration) seamlessly happens in real-time.

Connectivity used to be physical and centralised. But, for businesses to succeed—let alone keep up—in today’s fast-changing economy, they need to move beyond that and thoroughly embrace and facilitate interconnectivity.

What does global interconnectivity look like today?

With interconnectivity broadly defined, we can take a look at what’s happening behind the scenes in today’s interconnected enterprises.

For starters, the days of a central hub of operations are long over. Instead of one location serving as the nucleus for the organisation’s entire networking infrastructure and support, there are now dozens—if not hundreds—of server rooms, data centres, network operations centres, etc., seamlessly connected to one another, all supported by a global, distributed team.

This means that when it comes to network topologies, the hub and spoke models of yore no longer apply. Everything is now meshed with one another, and point-to-point connections can’t provide true interconnectivity.

Of course, it helps that everything is in the cloud, which has made hardware and software globally available and disconnected from any one physical location. There’s a reason revenue in the public cloud market is expected to reach $525 billion in 2023, according to Statista.

Interconnectivity has even changed service-level agreements. Uptime alone isn’t good enough, as today’s end users have a need for speed. If the network can’t work as quickly as customers and internal team members need it to, then it’s basically like the entire network is down.

With interconnectivity, the need for speed is now central to service-level agreements. If networks fail to deliver data quickly enough, it can have the same impact as downtime. Latency, bandwidth limitations, and delays must be minimised to meet the demands of customers and internal teams who rely on real-time access.

Business benefits of interconnectivity

How do we benefit from this increased interconnectivity? By embracing global, cloud interconnection in an era of digital transformation, organisations can expect to see the following benefits:

1. Interconnectivity enables more seamless collaboration

Today, business doesn’t just happen from 9am to 5pm, Monday through Friday, at a central office. With globally distributed teams, increased mobility and near-constant customer demand for service and support, business can’t afford to ever grind to a halt. Global interconnectivity ensures that teams can collaborate and remain efficient no matter where in the world they are, what time it is or what device they want to use.

2. Less prone to error or downtime

A network predicated on global interconnection is far more resilient than one supported just by point-to-point connections. Even if one part of the network goes down or is prone to error, the meshed nature of an interconnected network ensures that other lines of communication and collaboration remain intact. Considering the cost of network downtime today, this can mean the difference between a profitable day and millions in unexpected costs. The average cost of just an hour of network downtime in 2017 stood at $100,000, and it’s likely even higher and growing today.

3. Interconnectivity leads to reduced latency

Speed is the name of the game today. If a network isn’t lightning fast, then in many ways it might as well be down. An interconnected network ensures that data travels through the most optimal paths in all instances. Also, with a distributed network architecture, data doesn’t need to travel from a central point to all outposts but rather can be held where it’s needed. High availability data will sit on the edge reducing the time to get it in front of the user, and less often accessed non-latency sensitive data can be kept centrally.

4. Fully realise benefits of virtualisation at scale

In 2019, approximately one out of every $10 spent on software will be devoted to virtualisation. However, for internal stakeholders to ever fully appreciate the benefits of virtualised infrastructure or connectivity, a network predicated on cloud interconnection must be in place, to ensure unfettered access to, and bandwidth for, virtualised assets.

Without reliable interconnection, the full potential of virtualised environments remains underutilised, limiting business agility and growth.

5. Simplified deployments

This, at first, can seem counterintuitive. After all, if an interconnected network involves more network connections and endpoints than before, then how can it be simpler to deploy? But, with cloud and outsourced networking services now becoming the norm, businesses can more easily gain the benefits of interconnectivity without implementing anything additional as far as physical hardware, software or infrastructure is concerned.

6. Not reliant on any one vendor

In the past, even the largest companies likely had one or two telco providers, one operating system, one hardware manufacturer and the same type of software across the entire organisation. Those days are long gone. This helps with resiliency, as issues that crop up with one vendor are highly unlikely to lead to lasting damages. For example, if the dedicated carrier access into one office goes down for the day, then the location can just turn to other connectivity options within their interconnected network for the time being, like utilising Software-Defined Network (SDN) technology to bring up alternate connectivity in near real-time.

7. Capable of supporting IoT

Interconnectivity ensures that IoT devices can communicate seamlessly and in real-time, providing the foundation for improved efficiency and smarter operations across industries. As IoT adoption grows, the need for reliable interconnection becomes even more critical for maintaining smooth, scalable, and secure interactions between devices and networks.

Overcoming logistical hurdles of global interconnectivity

Of course, global interconnection isn’t without its potential problems. Before an organisation can fully appreciate any of interconnectivity’s positive attributes, it must resolve possible issues first.

Often, it can be difficult to maintain and oversee everything required for cloud interconnections. Globally distributed IT support can be hard to effectively coordinate, and businesses can find it expensive to maintain all that networking equipment. These kinds of logistical issues abound with interconnectivity, especially for organisations still tethered to connectivity-based thinking and workflows.

And, perhaps most importantly, the lack of central oversight that can sometimes occur in such a sprawling network complicates compliance and cybersecurity. According to numbers from Accenture and the Ponemon Institute, yearly cybersecurity-related costs now reach almost $12 million, and have been growing by more than 22 percent annually.

High bandwidth is also a major issue to contend with in an interconnected network. With more devices and more users leveraging a greater number of high-bandwidth applications like video, VoIP and SaaS apps, even a meshed network with multiple redundant connections can sometimes struggle to keep it with the ever-rising workloads. It can often become an endless game of catch-up, with teams struggling to add enough bandwidth to meet needs that always rise.

One of the biggest hurdles with global interconnection, however, has nothing to do with technology or networking. Rather, how do you set up an interconnected ecosystem that spans the globe yet adheres to all of the laws and compliance regulations in each of the geographic areas it touches?

In particular, it can be difficult to guarantee that certain data is only stored and used in particular geographies when that level of specificity and location flies against the very nature of interconnectivity. When certain tools and data sets are legally constrained to certain countries or regions, promoting global interconnection can post a challenge.

What is the future of interconnectivity?

Despite the potential hurdles, businesses and their stakeholders should expect more interconnectivity, not less, going forward. In the immediate future, networks and enterprise IT will be further meshed and even less centralised than before. Multi-cloud connectivity is now the new norm. This shift will allow organisations to create more agile and resilient infrastructures, enabling faster data access and improved scalability across various cloud environments. As interconnectivity grows, businesses can expect enhanced collaboration, reduced latency, and greater flexibility in their digital operations.

As interconnection becomes mainstream, devices and applications that now seem far-fetched will become reality. Artificial intelligence, augmented reality and ubiquitous support for wireless networks and devices will all be seamlessly possible at scale thanks to increased interconnectivity.

But, none of this will come to life without greater enterprise reliance on outside support. To get this kind of interconnectivity off the ground and keep it running, organisations will have to lean on third-party support plus dedicated interconnectivity services like Digital Realty’s ServiceFabric™.

Interested in learning even more about interconnectivity? Check out this webinar on demand for more insights and knowledge from top industry experts on global cloud interconnection.

Frequently Asked Questions

What are the benefits of interconnection?

Interconnection enhances network performance, boosts scalability, and enables businesses to leverage flexible, efficient connectivity. It allows for seamless data exchange, driving digital transformation.

Why are interconnections important for the future?

Interconnections are critical for the future as they support the growing demand for cloud computing, IoT, and real-time data access, enabling businesses to stay competitive in a rapidly evolving digital landscape.

What is the purpose of interconnectedness?

The purpose of interconnectedness is to create a unified, efficient network environment where businesses can optimise their operations, increase reliability, and improve collaboration across systems and cloud platforms.

How does interconnection relate to cloud computing?

Interconnection is crucial for cloud computing as it enables fast, reliable connections between data centres, cloud providers, and networks. This reduces latency, improves performance, and supports seamless cloud services integration.