How Digital Ecosystems Power AI Strategies

In today’s rapidly evolving digital landscape, data forms the backbone of AI, fueling the modern business engine. As generative AI technologies advance, data centers are experiencing explosive growth, with demand continuing to exceed supply in many areas. A prime example is the US, where data center vacancy rates have plummeted to between 1% and 5% across many key markets, according to a recent DE-CIX report. With the total US data center capacity surpassing 11,000 megawatts (MW) in 2024, this figure is set to nearly double in the next two to three years, reaching close to 30 gigawatts (GW). Some forecasts project more than 40 GW in the US by 2029.

Connectivity: The catalyst for AI innovation

However, from the perspective of the digital economy, as Dr. Thomas King, CTO of DE-CIX, emphasizes, a data center’s true value lies in its connectivity. In the realm of AI, seamless dataflows to and from models are critical. The performance of AI applications – whether in IoT, financial services, autonomous vehicles, or robotics – depends on the ability of data centers, networks, and interconnection platforms to work in unison. These high-performance infrastructures must be interconnected for optimal AI execution, ensuring that data transmissions are seamless, secure, and resilient.

The past decade has seen an unprecedented surge in cloud-based services, remote work, telemedicine, and, most recently, generative AI. This digital evolution has driven the need for businesses to prioritize low-latency, redundant, and resilient interconnection options – factors which are foundational to AI success. 

These factors rely on thriving digital ecosystems ideally supported by strong, neutral Internet Exchanges (IXs), as highlighted in the DE-CIX study, Navigating the Digital Future: Neutral Internet Exchanges as Catalysts for Ecosystem Growth.

Bridging infrastructure gaps with digital ecosystems

Interconnection platforms serve as the bridge between diverse digital infrastructures, bringing together data centers, telecom networks, cloud providers, content delivery networks, and many other infrastructure players and service providers under one roof. AI Exchanges, in combination with Internet and Cloud Exchanges, offer the potential for unparalleled flexibility, allowing companies to select providers and services tailored to their specific needs. This level of customization, scalability, and geographical redundancy is vital for powering next-gen AI applications.

The distributed data center and carrier-neutral interconnection model fosters the growth of digital ecosystems by aggregating multiple data center facilities of different providers within a metropolitan area, massively enhancing the potential for network density on the platform. The distributed nature of these platforms also increases redundancy options, while ensuring lower latency and closer proximity to end-users – essential elements for AI-driven applications. The benefits of connecting to neutral IXs are clear – such a dense ecosystem fosters collaboration among multiple data centers and networks, seamlessly integrating disparate infrastructures. Platforms that unite Internet, Cloud, and AI Exchange capabilities in a simple and flexible manner offer a company access to all relevant networks and infrastructure players for developing a robust and game-changing AI infrastructure strategy.

A strong example of this ecosystem-building power is New York, the interconnection powerhouse of the US. The two largest IXs in New York are both operated in a data center and carrier-neutral manner, and 64% of New York’s networks are connected to one or both of them, demonstrating a clear preference by network operators for the neutral IX model. DE-CIX New York, established in 2014 and the youngest IX in NY, is now the largest IX in the city, featuring 36 interconnected data center facilities and, as the 4th largest in the whole country today, serving more networks than any other IX in the Northeast region of the US. DE-CIX New York offers access to a vibrant and diverse ecosystem not only from NYC itself, but also from facilities outside of the city center, such as in New Jersey and Orangeburg. In addition, transport partners like PacketFabric facilitate participation in this leading ecosystem for companies more distant from the hub.

The key to AI implementation success

The demands made of connectivity by AI vary depending on the task at hand. In the case of large language models (LLMs), extremely high bandwidth is required to manage the massive datasets involved in AI training. During inference – AI in action, as I like to call it – security and latency are primary concerns, as real-time data access is essential for a whole array of critical AI-powered use cases, from financial services to driverless cars. Connectivity solutions that offer scalable cloud connectivity and cloud routing services, as well as direct connectivity to relevant networks like AI as a service providers, are crucial for these set-ups.

The distributed and independent nature of neutral IXs brings a multitude of advantages for AI implementation. Geographically separated data centers enable networks to redundantly connect to IXs, increasing resilience. They also mean that a company can choose a data center facility in close proximity to its end-customers, enabling ultra-low-latency data exchange. This infrastructure is vital for handling the data flows necessary for AI model training and inference, whether within a hybrid cloud environment or fully outsourced to AI-as-a-Service platforms.

Three essential connectivity elements for AI success

To fully harness AI’s potential, companies must have a robust connectivity strategy in place. First, direct cloud connections, ideally via the private, SLA-backed connectivity solutions provided by the respective cloud service providers, offer cost-efficiency, security, and guaranteed performance. Second, a scalable cloud routing service ensures smooth interaction across multi-cloud and hybrid-cloud environments. Finally, direct peering with AI-as-a-Service operators and partner or IoT networks is critical to maintain real-time AI dataflows.

Companies can achieve this by leveraging interconnection platforms like DE-CIX’s, which optimize network connections and ensure low-latency access to AI tools, with performance backed by industry-leading SLAs. This approach empowers businesses to aggregate and analyze real-time data from multiple sources and provide real-time insights, decisions, and actions, unlocking the full potential of AI.

Building a future-proof AI infrastructure strategy

For long-term AI success, businesses must develop a comprehensive infrastructure strategy that integrates high-performance connectivity with optimized cloud usage. Many enterprises, particularly those with global operations, are turning to interconnection providers for their expertise in designing resilient, secure, and geographically diverse network environments. Partnering with neutral interconnection specialists like DE-CIX enables businesses to access rich digital ecosystems and tailor solutions to their unique needs.

By collaborating with partners to close connectivity gaps, DE-CIX is expanding its reach to underserved regions, ensuring that businesses – regardless of location – can participate in vibrant digital ecosystems. This forward-thinking approach is key to enabling businesses to scale and evolve with AI technologies.

In conclusion, the foundation of any successful AI initiative lies in a well-conceived connectivity strategy. High bandwidth, low-latency network connections are no longer optional – they are critical to staying competitive in today’s AI-driven world.

Ivo Ivanov has been Chief Executive Officer at DE-CIX and Chair of the Board of the DE-CIX Group AG since 2022. Prior to this, Ivanov was Chief Operating Officer of DE-CIX and Chief Executive Officer of DE-CIX International, responsible for the global business activities of the leading Internet Exchange operator in the world. He has more than 20 years of experience in the regulatory, legal and commercial Internet environment. Ranked as one of the top 100 most influential professionals of the Telecom industry (Capacity Magazine’s Power 100 listing, 2021/2022/2023/2024), Ivo is regularly invited to share his vision and thought leadership in various industry-leading conferences around the globe.