enabling the future of networks, enterprises & clouds - ptc 2014 - steve smith, ceo, equinix
DESCRIPTION
Steve Smith, CEO and president, delivered a keynote speech on growth projections for network and cloud services on Tuesday, January 21 at 9:30 AM HST. The keynote, entitled “Mapping the Future of Networks and Clouds Inside Equinix,” utilized data based on connectivity patterns within the company’s set of 95+ global data centers to provide a unique perspective on the trends that map the future of network and cloud service providers.TRANSCRIPT
PTC’14 | January 21
Enabling the Future of Networks, Enterprises & Clouds
Steve Smith, CEO
Positive Secular Trends
2© 2014 Equinix Inc.
Visit our PTC suite in Tapa Tower, Suite 2730www.equinix.com/cloud
The cloud is the paradigm shift for the next decade
…Interconnection is more critical than ever
…We enable networks, enterprises and clouds to connect
…#techtrends #winners #losers #whatnext?
Positive Secular Trends
3© 2014 Equinix Inc.
Visit our PTC suite in Tapa Tower, Suite 2730www.equinix.com/cloud
Agenda
1. Our Global Interconnection Platform
2. Perspective on the Cloud Market
3. Enabling the Future Together
Positive Secular Trends
4© 2014 Equinix Inc.
Visit our PTC suite in Tapa Tower, Suite 2730www.equinix.com/cloud
The Equinix Journey
Note: Based on the midpoint of our FY2013 guidance as announced on a Form 8-K filed with the SEC on 11/12/13. Does not constitute a reiteration or reaffirmation of such guidance.
1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013E
$- $- $13 $63 $77 $118 $164
$221 $287
$419
$705
$883
$1,196
$1,570
$1,896
$2,152
Equinix Revenues ($M)
Positive Secular Trends
5© 2014 Equinix Inc.
Visit our PTC suite in Tapa Tower, Suite 2730www.equinix.com/cloud
The Global Platform
GlobalData Centers100 Data Centers
9.9M+ Gross Square Feet99.99999% Uptime
Interconnection950+ Networks
124,000+ Cross ConnectsWorld’s Largest Exchange Provider
BusinessEcosystems
Equinix Marketplace™4,400+ Businesses
Revenue Opportunities
Note: Cross-connect count includes Asia Tone and ancotel acquisitions.
Positive Secular Trends
6© 2014 Equinix Inc.
Visit our PTC suite in Tapa Tower, Suite 2730www.equinix.com/cloud
Cloud & IT (24%)
Content & Digital Media (20%)
Enabling Ecosystems
Financial Services (21%)
Enterprises (9%)
Networks (26%)
Note: Percentage of monthly recurring revenues in Q3 2013, consisting primarily of revenues from colocation, interconnection and managed services as reported on Q3 2013 earnings call.
Positive Secular Trends
7© 2014 Equinix Inc.
Visit our PTC suite in Tapa Tower, Suite 2730www.equinix.com/cloud
Agenda
1. Our Global Interconnection Platform
2. Perspective on the Cloud Market
3. Enabling the Future Together
Positive Secular Trends
8© 2014 Equinix Inc.
Visit our PTC suite in Tapa Tower, Suite 2730www.equinix.com/cloud
Technology Trends Driving Traffic Growth
Trends
Internet of Things
19 billion networked devices in 2017 or 2.5 per capita2
30 billion things by 20206
Big Data 90% of the world’s data has been generated in the last 2 years6 >800% growth is expected by 2020, with 80% of new data unstructured
Apps Mobile apps are revolutionizing how we live our lives and are a $27B market this year, growing at an 85% rate3
Mobility 54% of all networked devices will be mobile-connected by 2017. An average smart phone will generate 2,576 MB of data traffic/month4
Social Information now flows real-time across global social networks
TradingTrading is now electronic and high-frequency, reflected in rapidly rising peak market data message volumes. More than 60% of foreign exchange volumes is electronically traded.
Traffic1
Global IP Traffic
Global Mobile Traffic
32
121
0.9
11.2
2012 2017
2012 2017
Exabytes per month
Exabytes per month
Source: [1][2][4] Cisco,[3] ABI Research,[5] Gartner,[6]IBM
Positive Secular Trends
9© 2014 Equinix Inc.
Visit our PTC suite in Tapa Tower, Suite 2730www.equinix.com/cloud
Cloud Adoption Ramping Up
Source: Gartner (Feb 2013)
Global Public Cloud Market Size ($B) Global Private Cloud Market Size ($B)
2012 2016
Management & Security
IaaS
PaaS
SaaS
Business Process as a Service
Advertising
CAGR 12%-16% Total ~14%
2012 2016
Software
Hardware
Source: IDC – Worldwide Private Cloud IT Infrastructure Forecast (April 2013), McKinsey Cloud Initiative
CAGR 12%-16% Total ~15%
~10B
~$20B
~110B
~$212B
Positive Secular Trends
10© 2014 Equinix Inc.
Visit our PTC suite in Tapa Tower, Suite 2730www.equinix.com/cloud
Cloud Disrupts the Tech Landscape
Source: (Evercore 2013)
Cloud Providers
Growth
PriceCustomization
Outsourced IT
Assisting enterprises to get to cloud
Cloud is easier to get
Networks
Increased traffic
Evolving value proposition to enterprises
Managed Services
Provide own cloud solutions
Less demand for managed services
Data Centers
Lower latency
Direct to IaaS data center
Hardware Vendors “DIY,”
eliminating vendor lock-in
Enabling cloud
Positive Secular Trends
11© 2014 Equinix Inc.
Visit our PTC suite in Tapa Tower, Suite 2730www.equinix.com/cloud
Multi-tenant Data Centers Will Be Traffic Magnets
Global Data Center Traffic
2012 2013 2014 2015 2016 20170
1
2
3
4
5
6
7
8
Cloud Data Center (35% of CAGR)
Traditional Data Center (12% of CAGR)
CAGR 2012-2017: 25%
69%
31%54%
46%
Source: Cisco Global Cloud Index Report 2013
Zettabytes/Year
Positive Secular Trends
12© 2014 Equinix Inc.
Visit our PTC suite in Tapa Tower, Suite 2730www.equinix.com/cloud
Interconnection/Low Latency Is Increasingly Important
Application Performance Requirements
%
PerformanceHigh <80ms RTD Med <40ms RTD Low <20ms RTD <1ms RTD
M2M TradingVirtual Desktop
Gaming
Video
Advertising
CRM
Payments
ERP
Finance
Test
Backup
HRM
Source: Equinix
Workloads Deployed in the Cloud
Source: Rightscale
Development
Test
Customer Web Apps
Internal Web Apps
Batch Processing
Mobile
Social
Big Data
Gaming
0 10 20 30 40 50 60 70 80 90
Positive Secular Trends
13© 2014 Equinix Inc.
Visit our PTC suite in Tapa Tower, Suite 2730www.equinix.com/cloud
Enterprises Migrate to Hybrid Cloud
Most G5000 enterprises moving to hybrid cloud environments
Enterprises evaluating hybrid cloud use cases
2013 20180%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Public
Hybrid
Private
Cloud User Respondents
– Companies with 1,000+ Employees
(N-855)
Business Requirement
• Key driver
Seasonal Peaks (E-commerce)
• Compute capacity during peak demand
Compliant Data(HIPAA, SOX)
• Sovereignty of enterprise information
Business Apps(ERP, CRM)
• Low latency requirements of core business applications
Big Data (Analytics)
• Large data volume workloads
Source: NorthBridge Venture Partners; Team analysis, Bain Analysis; Literature search; Gartner, IDC, Enterprise interviews (n=30)
Positive Secular Trends
14© 2014 Equinix Inc.
Visit our PTC suite in Tapa Tower, Suite 2730www.equinix.com/cloud
Agenda
1. Our Global Interconnection Platform
2. Perspective on the Cloud Market
3. Enabling the Future Together
Positive Secular Trends
15© 2014 Equinix Inc.
Visit our PTC suite in Tapa Tower, Suite 2730www.equinix.com/cloud
Mobility Centers Enabling mobile broadband
Our Business Is Cultivating Ecosystems
Peering Networks Scaling the Internet
Caching Delivering digital content
Magnet Client Hosting Architecting ecosystems
WAN Hubs Facilitating efficient enterprise networks
Cloud Hubs Enabling public, private, hybrid clouds
Direct Connect Improving cloud access
Proximity Hosting Enabling low-latency transactions
Esta
blis
hed
Emer
ging
Service Provider Networks Supporting mission-critical services
Positive Secular Trends
16© 2014 Equinix Inc.
Visit our PTC suite in Tapa Tower, Suite 2730www.equinix.com/cloud
Equinix Is the On-ramp to the Cloud
Enterprise deployments (hybrid, private in Equinix)
Enables hybrid cloud deployments for mission-critical apps
Direct access to public clouds
Networks can reach multiple clouds in a single location
Positive Secular Trends
17© 2014 Equinix Inc.
Visit our PTC suite in Tapa Tower, Suite 2730www.equinix.com/cloud
Robust Growth Expectations for IaaS and SaaS
Equinix Global Cloud Customers by Segment Q3’13
Equinix Global Revenue Growth for IaaS & SaaS
IaaS7%
SaaS29%
MS41%
SI7%
Other16%
Total: 1,200+
Projected growth
SaaS
IaaS
Observed growth
Today
Positive Secular Trends
18© 2014 Equinix Inc.
Visit our PTC suite in Tapa Tower, Suite 2730www.equinix.com/cloud
Cloud Revenue Opportunity for NSPs Inside Equinix
$1.4 billion today 3x by 2017
Positive Secular Trends
19© 2014 Equinix Inc.
Visit our PTC suite in Tapa Tower, Suite 2730www.equinix.com/cloud
The cloud is the paradigm shift for the next decade
…Interconnection is more critical than ever
…We enable networks, enterprises and clouds to connect
…#techtrends #winners #losers #whatnext?
Positive Secular Trends
20© 2014 Equinix Inc.
Visit our PTC suite in Tapa Tower, Suite 2730www.equinix.com/cloud
Thank You