Enabling the Future of Networks, Enterprises & Clouds - PTC 2014 - Steve Smith, CEO, Equinix

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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.

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Enabling the Future of Networks, Enterprises & Clouds - PTC 2014 - Steve Smith, CEO, Equinix

  1. 1. Enabling the Future of Networks, Enterprises & Clouds Steve Smith, CEO PTC’14 | January 21
  2. 2. 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 Visit our PTC suite in Tapa Tower, Suite 2730 www.equinix.com/cloud © 2014 Equinix Inc. 2
  3. 3. Agenda 1. Our Global Interconnection Platform 2. Perspective on the Cloud Market Positive Secular Trends 3. Enabling the Future Together Visit our PTC suite in Tapa Tower, Suite 2730 www.equinix.com/cloud © 2014 Equinix Inc. 3
  4. 4. The Equinix Journey 2,152 1,896 1,570 1,196 Equinix Revenues ($M) 883 705 Positive Secular Trends $- $- $13 1998 1999 2000 419 $63 $77 $118 2001 2002 2003 $164 2004 221 2005 287 2006 2007 2008 2009 2010 2011 2012 2013E 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. Visit our PTC suite in Tapa Tower, Suite 2730 www.equinix.com/cloud © 2014 Equinix Inc. 4
  5. 5. The Global Platform Interconnection Global Data Centers 100 Data Centers 9.9M+ Gross Square Feet 99.99999% Uptime 950+ Networks 124,000+ Cross Connects World’s Largest Exchange Provider Business Ecosystems Equinix Marketplace™ 4,400+ Businesses Revenue Opportunities Positive Secular Trends Note: Cross-connect count includes Asia Tone and ancotel acquisitions. Visit our PTC suite in Tapa Tower, Suite 2730 www.equinix.com/cloud © 2014 Equinix Inc. 5
  6. 6. Enabling Ecosystems Cloud & IT (24%) Financial Services (21%) Networks (26%) Content & Digital Media (20%) Enterprises (9%) Positive Secular Trends 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. Visit our PTC suite in Tapa Tower, Suite 2730 www.equinix.com/cloud © 2014 Equinix Inc. 6
  7. 7. Agenda 1. Our Global Interconnection Platform 2. Perspective on the Cloud Market Positive Secular Trends 3. Enabling the Future Together Visit our PTC suite in Tapa Tower, Suite 2730 www.equinix.com/cloud © 2014 Equinix Inc. 7
  8. 8. Technology Trends Driving Traffic Growth Traffic1 Trends Global IP Traffic 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 $27B market this year, growing at an 85% rate3 Exabytes per month 121 32 2012 2017 Mobility 54% of all networked devices will be mobile-connected by 2017. An average smart phone will generate 2,576 MB of data traffic/month4 Global Mobile Traffic Exabytes per month Positive Secular Trends Social Information now flows real-time across global social networks Trading Trading is now electronic and high-frequency, reflected in rapidly rising peak market data message volumes. More than 60% of foreign exchange volumes is electronically traded. 11.2 0.9 2012 2017 Source: [1][2][4] Cisco,[3] ABI Research,[5] Gartner,[6]IBM Visit our PTC suite in Tapa Tower, Suite 2730 www.equinix.com/cloud © 2014 Equinix Inc. 8
  9. 9. Cloud Adoption Ramping Up Global Public Cloud Market Size ($B) Global Private Cloud Market Size ($B) ~$212B ~$20B Management & Security CAGR 12%-16% Total ~14% CAGR 12%-16% Total ~15% Software Hardware IaaS ~110B PaaS ~10B SaaS Positive Secular Trends 2012 Source: Gartner (Feb 2013) 2016 Business Process as a Service 2012 2016 Source: IDC – Worldwide Private Cloud IT Infrastructure Forecast (April 2013), McKinsey Cloud Initiative Visit our PTC suite in Tapa Tower, Suite 2730 www.equinix.com/cloud © 2014 Equinix Inc. 9
  10. 10. Cloud Disrupts the Tech Landscape Growth Cloud Providers Outsourced IT Price Customization Assisting enterprises to get to cloud Cloud is easier to get Increased traffic Networks Managed Services Evolving value proposition to enterprises Provide own cloud solutions Less demand for managed services Positive Secular Trends Enabling cloud Hardware Vendors “DIY,” eliminating vendor lock-in Lower latency Data Centers Direct to IaaS data center Source: (Evercore 2013) Visit our PTC suite in Tapa Tower, Suite 2730 www.equinix.com/cloud © 2014 Equinix Inc. 10
  11. 11. Multi-tenant Data Centers Will Be Traffic Magnets Global Data Center Traffic Zettabytes/Year 8 CAGR 2012-2017: 25% 7 6 5 69% Cloud Data Center (35% of CAGR) 4 3 Traditional Data Center (12% of CAGR) Positive Secular Trends 2 1 46% 31% 54% 0 2012 2013 2014 2015 2016 2017 Source: Cisco Global Cloud Index Report 2013 Visit our PTC suite in Tapa Tower, Suite 2730 www.equinix.com/cloud © 2014 Equinix Inc. 11
  12. 12. Interconnection/Low Latency Is Increasingly Important Workloads Deployed in the Cloud Application Performance Requirements Performance Gaming High <80ms RTD Med <40ms RTD Low <20ms RTD <1ms RTD Test CRM Virtual Desktop M2M Trading Backup Payments Gaming Email ERP Video HRM Finance Advertising Big Data Social Mobile Batch Processing Internal Web Apps Positive Secular Trends Customer Web Apps Test Development 0 Source: Rightscale 20 40 60 80 100 % Source: Equinix Visit our PTC suite in Tapa Tower, Suite 2730 www.equinix.com/cloud © 2014 Equinix Inc. 12
  13. 13. Enterprises Migrate to Hybrid Cloud Most G5000 enterprises moving to hybrid cloud environments Enterprises evaluating hybrid cloud use cases 100% Cloud User Respondents – Companies with 1,000+ Employees (N-855) 90% 80% Business Requirement • Key driver Seasonal Peaks (E-commerce) 70% 60% Hybrid Compliant Data (HIPAA, SOX) • Sovereignty of enterprise information Business Apps (ERP, CRM) • Low latency requirements of core business applications Public 50% • Compute capacity during peak demand Private 40% Positive Secular Trends 30% 20% 10% Big Data (Analytics) 0% 2013 • Large data volume workloads 2018 Source: NorthBridge Venture Partners; Team analysis, Bain Analysis; Literature search; Gartner, IDC, Enterprise interviews (n=30) Visit our PTC suite in Tapa Tower, Suite 2730 www.equinix.com/cloud © 2014 Equinix Inc. 13
  14. 14. Agenda 1. Our Global Interconnection Platform 2. Perspective on the Cloud Market Positive Secular Trends 3. Enabling the Future Together Visit our PTC suite in Tapa Tower, Suite 2730 www.equinix.com/cloud © 2014 Equinix Inc. 14
  15. 15. Our Business Is Cultivating Ecosystems Mobility Centers Direct Connect Improving cloud access Cloud Hubs WAN Hubs Enabling mobile broadband Enabling public, private, hybrid clouds Facilitating efficient enterprise networks Proximity Hosting Magnet Client Hosting Enabling low-latency transactions Architecting ecosystems Positive Secular Trends Service Provider Networks Caching Peering Networks Supporting mission-critical services Delivering digital content Scaling the Internet Visit our PTC suite in Tapa Tower, Suite 2730 www.equinix.com/cloud © 2014 Equinix Inc. 15
  16. 16. Equinix Is the On-ramp to the Cloud Enables hybrid cloud deployments for mission-critical apps Enterprise deployments (hybrid, private in Equinix) Direct access to public clouds Positive Secular Trends Networks can reach multiple clouds in a single location Visit our PTC suite in Tapa Tower, Suite 2730 www.equinix.com/cloud © 2014 Equinix Inc. 16
  17. 17. Robust Growth Expectations for IaaS and SaaS Equinix Global Cloud Customers by Segment Q3’13 Other 16% Equinix Global Revenue Growth for IaaS & SaaS Today IaaS 7% IaaS SaaS Observed growth SI 7% SaaS 29% Positive Secular Trends Projected growth MS 41% Total: 1,200+ Visit our PTC suite in Tapa Tower, Suite 2730 www.equinix.com/cloud © 2014 Equinix Inc. 17
  18. 18. Cloud Revenue Opportunity for NSPs Inside Equinix $1.4 billion today 3x by 2017 Positive Secular Trends Visit our PTC suite in Tapa Tower, Suite 2730 www.equinix.com/cloud © 2014 Equinix Inc. 18
  19. 19. 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 Visit our PTC suite in Tapa Tower, Suite 2730 www.equinix.com/cloud © 2014 Equinix Inc. 19
  20. 20. Thank You Positive Secular Trends Visit our PTC suite in Tapa Tower, Suite 2730 www.equinix.com/cloud © 2014 Equinix Inc. 20

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