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5 Trends Driving Demand for Fiber

The demand for global bandwidth has grown rapidly over the past few years, and fiber is having a major moment as a result. With an average of over 500,000 people using the Internet for the first time every day, exponential cloud hyperscaler growth, and over 25 billion IoT devices expected to be active by 2030, the fiber frenzy won’t slow down anytime soon. In fact, the fiber market is expected to grow from $7.4 billion in 2021 to $11.1 billion in 2030.

Zayo President Andrés Irlando recently participated in the “Fibre to the Everything” panel at ITW 2022 to discuss the importance of fiber now and in the future. In this blog, we’ll dive into five of the broadband industry trends driving the demand for fiber.

1. Adoption of high-bandwidth applications

Emerging applications like 5G, artificial intelligence, virtual reality, and IoT drive the need for more bandwidth and low latency connectivity. Luckily, fiber provides the infrastructure backbone needed to power these technologies.

While the demand for reliable bandwidth isn’t new, the pandemic accelerated the need for more bandwidth on both the consumer and business side. Lockdowns and quarantines drove more people to video streaming applications like YouTube and Netflix and conferencing applications like Zoom, increasing consumer bandwidth needs. The pandemic also forced business leaders to reassess their technology needs, especially in areas of automation and data analytics, driving business bandwidth requirements up.

2. Hypervelocity of data growth

All of these new devices, Internet users, and technologies we’re seeing today mean companies collect and analyze more data than ever before. With this influx of data comes a need for greater bandwidth to store, transfer, interpret, and make fast decisions with it. The amount of data and data traffic will just continue to grow as more organizations and consumers use these applications.

Bandwidth-intensive applications like IoT, cloud computing, and artificial intelligence are also data-intensive and rely heavily on fast, secure, reliable data transmission to work properly. Fiber infrastructure provides the reliable connectivity needed to support data transfers from edge to cloud, edge to core, and edge to edge.

3. Strategizing the digital ecosystem

As Irlando says during the ITW panel discussion, “Digital transformation used to be an option, now it’s a requirement.” In order to survive and compete in any industry, companies must undergo some form of digital transformation.

With this digitization comes a lot of planning. Companies must determine what kinds of technologies they’ll need to optimize processes and better satisfy customer needs. For those looking to digitally transform, bandwidth must be a top consideration. Regardless of the technologies, you choose to leverage, you will need more bandwidth to achieve your digital transformation goals.

What’s more, with over 74% of US companies using or planning to use a hybrid work model, digital priorities have shifted over the past few years. Companies must now accommodate an increasingly dispersed workforce. Using edge and cloud solutions with fiber as a reliable, low latency backbone, companies can ensure a seamless working environment wherever employees work. Irlando aptly describes fiber infrastructure as the “artery of the digital ecosystem” as it underpins all other digital technologies.

4. Cloud hyperscaler growth

The global hyper-scale cloud market is expected to grow from $191.15 billion to $693.49 billion by 2026, driving an even greater demand for fiber. Cloud hyperscalers like Microsoft, Amazon, Google, and Facebook currently dominate the market and require enormous amounts of bandwidth to power their operations.

While these organizations sometimes own and operate their own fiber – US-based hyperscale cloud platforms have invested around $20 billion in new subsea cables alone – they’re also leasing capacity on fiber optic cables from companies like Zayo. These companies have a global presence and rely on fiber to bring them and their customer’s bandwidth wherever they are. Hyperscalers also need bandwidth to fuel the technology innovations they’re creating to shape our world.

5. Closing the digital divide

Finally, the push to bring broadband connectivity to previously underserved or unserved populations drives fiber expansion into new areas. In the US, the recently passed Infrastructure Investment and Jobs Act affirms the government’s commitment to broadband expansion with specific investments in middle-mile infrastructure. With more than 30 million Americans living without adequate broadband today, this is a positive step forward.

“All of the regulatory workaround broadband and fiber is fantastic,” Irlando says during the panel discussion, “It’s addressing a really important, fundamental need – to close the digital divide and make the economics of rural broadband feasible. We think it will spur tremendous innovation and economic growth.”

Zayo meets increasing demand with an extensive fiber network

Zayo is proud to be at the forefront of the fiber revolution. Our future-ready fiber network is driving innovation and growth in some of the world’s most important organizations. We recently announced our largest organic network expansion to date including new Long-Haul Dark Fiber routes, 400G capacity upgrades across our network, and global subsea routes. We’re building unique, diverse, high-capacity routes where our customers need them now and in the future.

Explore our extensive fiber network here and see how Zayo fiber can fuel your own digital transformation.