By Adam Gardner, Head of Products @ NEXTDC
Remember the first few months of 2020? It’s a crazy question, really. For anyone in the world of IT (and indeed, anyone in the world) the question should really be, how could we forget them?
For most of us, early 2020 was the watershed moment when digital transformation went from optional to an imperative requirement. As Marc Benioff, the CEO of Salesforce famously said in May of that year:
“I’ve been on more sales calls with more CEOs in the last two months than at any time in my career. And there is universal agreement among them. Digital transformation, well, this isn’t a want to have, it’s a must-have. Companies and organisations and governments around the world have a digital transformation imperative like never before and many are accelerating their plans for digital first, work from anywhere environment.”
Fast-forward three years, and the digital transformation pressure valve hasn’t been released. In fact, the demand has only intensified. Recent stats from Polaris Market Research estimate the digital transformation market to be worth around US$588 billion (AU$890B) globally, with spend expected to hit US$3.4 trillion (AU$5.15T) by 2026. The speed of transformation is accelerating at a pace unlike ever before.
When it comes to digital transformation, unfortunately there’s no “one size fits all” approach.
Each transformation will be unique to each organisation, with exclusive drivers and operating environments. However, we do come across some common themes and trends as we support our own customers on their digital transformation journeys.
Each of the following megatrends* are contributing to evolving digital infrastructure needs. Staying on top of them will pay dividends down the track when you’re shaping your own transformation plans.
Trend 1: Artificial intelligence (AI)
Generative AI and its cousin, machine learning (ML) are currently changing the game for many industries. AI has been increasingly present over the past decade but has really come to the fore of public consciousness since ChatGPT landed at the end of 2022.
Generative AI systems (such as ChatGPT) have allowed the average user to immediately visualise the real-world potential and opportunity of AI. We are just at the beginning of this journey. AI is more than just about language and artistic creativity support though. As generative technology reaches critical mass, it’s not hard to conclude AI is going to transform entire industries over the next five years or so. Probably shorter.
From a digital transformation perspective, if AI is likely to be part of your plans, then you must be prepared to support the scale and growth these systems will engender – and quickly. Or, get left behind by the agile movers. This will require a combination of high-density compute, high-capacity connectivity and an architecture that combines your own infrastructure with public and private cloud resources in a cost-effective manner. It catapults what we have known as hybrid- or multi-cloud into the stratosphere.
Running your own hybrid or multi-cloud environment is a tough job, not to mention expensive. No wonder 80% of organisations will make the transition to colocation and cloud over the next few years, according to Gartner.
Trend 2: Networks and interconnectivity
On the road to 2030, the importance of interconnectivity cannot be overstated. With data creation and consumption exploding, so is the need for bandwidth connectivity that is low latency, reliable and dedicated.
Flexible and agile connectivity – both physical and virtual – between the various partners that deliver your overall digital transformation strategy is going to be one of the keys to success. It’s no exaggeration to say that secure and resilient interconnectivity is the backbone of the modern digital economy and we're committed to delivering world-class solutions that empower businesses to accelerate their digital transformations.
Trend 3: The Internet of Things (IoT)
Just like AI, IoT connected devices generate astronomical amounts of data – all of which is meaningless without the right processing and analysis. As these devices continue to spread throughout the country and the world – even into remote and regional areas – infrastructure for local processing is going to be required before it is sent back to central nodes for further use. It is simply not practical to backhaul the entirety of the data to metro locations.
From a digital infrastructure perspective, we expect to see further growth in the edge data centre market for the remainder of the decade. These facilities allow organisations to leverage the benefits of a fully managed data centre solution for localised computing purposes.
Australia’s mining industry is a great example of where the IoT megatrend is playing out in real-time. With more mining sites taking advantage of IoT-connected devices and sensors, the data can be processed in a local edge data centre rather than backhauled to a metro location. It’s exponentially more efficient.
Trend 4: Sustainability
It’s no secret that the data centres supporting enterprise digital infrastructure are major consumers of power. It’s critical we are focused on managing this impact and being as energy efficient as possible. We’ve always held the view that the best way to reduce carbon emissions is to minimise the creation in the first place. That can be done by investing in more efficient infrastructure. In NEXTDC terms, we call this being “frugal, not cheap” – one of our core values. Investing in the most efficient infrastructure, rather than the cheapest allows us to provide the best value – commercially and sustainably.
Other initiatives like solar arrays, renewable energy projects and true zero waste are also becoming increasingly important and contributing to sustainability targets.
Need help with your digital transformation plans?
At NEXTDC, we have more than 700 partners in our ecosystem, a 100% uptime guarantee and the ability to deliver carbon neutral colocation. We know we’d be a great fit to help you drive your own digital transformation plans, so reach out if you’d like to find out more.
* We’ve picked out four megatrends to explore in this article, but there are many more that are likely to impact enterprise digital infrastructure. Get in touch to find out more.