CEO Vision: Internet connectivity from the stars

Image courtesy of DE-CIX

The internet would not be the same without internet exchange points (IXs or IXPs). As its name suggests, IXs are physical locations that enable the exchange of traffic between internet service providers and content providers.

Think of it like a marketplace where networks agree to hand traffic off to each other.

Today, one of the largest IXs in the world is DE-CIX, a carrier- and data-centre-neutral internet exchange with over 30 locations across the globe. Its latest effort involves the use of low-Earth-orbit (LEO) satellites, which aim to provide underserved regions with better internet access.

To find out more about the matter, Frontier Enterprise got in touch with Ivo Ivanov, Chief Operating Officer of DE-CIX Group AG and Chief Executive Officer of DE-CIX International. We asked Ivanov about several topics, including internet adoption in remote areas, the cost of internet services using LEO satellites, the challenges that DE-CIX faces when setting up new IXs, and so much more.

DE-CIX has been around for nearly 30 years, and you’ve been part of it since 2007. What have been the highlights of your time there so far, and what are the most significant changes in internet connectivity you’ve seen over the years?

Since the founding of DE-CIX back in 1995, the internet, connectivity, and technology have grown at such a rapid pace, and it is amazing to see most parts of the world now being linked and interconnected.

The public internet has come a long way from the days of screeching modems and making a cup of coffee while the web page loads. DE-CIX has been there since those early days, and has worked together with network partners around the world to optimise traffic flows and make the internet a better place to do business.

DE-CIX began with the interconnection of three German networks who wanted to exchange data locally rather than traversing the Atlantic twice. This improved the latency in the networks, and therefore user experience, and this motivated other networks to connect as well. The more carriers and ISPs that recognised the benefits of peering within the ecosystem at DE-CIX’s Frankfurt internet exchange, the more gravity developed, drawing in more and more networks, year for year, making it, today, one of the largest IXs in the world.

Furthermore, DE-CIX has become established across the world, spanning the globe from the Americas to Europe, the Middle East, India, and Southeast Asia, accessible from more than 500 data centres in over 100 countries. With the cloud fully established as an enterprise solution, with video streaming in high definition, video conferencing as a standard form of communication, and the rise in popularity of online gaming, with the Internet of Things (IoT) bringing connectivity and intelligence to homes, cities, and factories, the smooth, fast internet of today looks and feels very different to the clunky, noisy internet of 1995.

To put things in perspective, back at the turn of the millennium, 2 Megabits (Mbits) of bandwidth was standard for commercial high-speed connections. Today, consumers have access to one up to 1 Gigabit (Gbit) – 500 times the bandwidth – or they have fibre to the building, in which case bandwidth can be much, much greater.

As for my own personal highlights: After setting up and operating UAE-IX in Dubai in 2012, as a managed service under the DE-CIX-as-a-service model, the last decade has seen a whirlwind of expansion activity. Going to the United States in 2014, followed by the Mediterranean in 2015, two of our star IXs were born: New York and Madrid, each becoming the fastest-growing IXs in their respective markets. We began operations in India in 2018, and Mumbai also developed strongly, becoming the largest IX in the APAC region last year.

Our next expansion step was into Southeast Asia, which we began in 2020, with the establishment of DE-CIX Malaysia and DE-CIX Singapore. Today, our global infrastructure encompasses over 30 IXs, a large number of which are directly interconnected, so that networks can interconnect and exchange data with networks located in other places via remote peering. This is the concept behind the distributed DE-CIX Asia infrastructure. For example: Any network connected to any of the DE-CIX IXs in Southeast Asia can access any of the other networks connected at any of the locations in the region.

We recently expanded our presence to Singapore to create an interconnection ecosystem in one of the densest metro markets in the region, especially with the strong demand for low latency and the huge traffic volumes driven by content consumption – video, payment, gaming, and other applications like on-demand and live streaming of sports.

The world has also transformed since pre-COVID times, and it is really exciting to see all of the data-driven innovations currently emerging. As a result, our society is becoming increasingly dependent on a range of wireless technical innovations. In this context, 5G will play a crucial role. There is much more to 5G than simply “super-fast internet” for the smartphone – 5G offers enormous potential for a range of sectors.

What are the common challenges that DE-CIX faces when establishing new interconnection points in other parts of the globe? How do you address those challenges?

Especially during the pandemic, expansion to new locations has posed new challenges for technical implementation. As our technical specialists were unable to travel, it became necessary for the technical team to implement everything remotely. As a result, we have been working more than ever with remote hands partners and data centre operators to build our infrastructure remotely.

We were also challenged to further automate, pre-configure, and standardise our deployments, so that it is easier for our remote hands partners to bring them up. In Southeast Asia, not only the infrastructure, but the entire building of relationships with the teams was done remotely, given that our expansion coincided with the onset of the pandemic.

With DE-CIX leveraging opportunities through LEO satellites, how does it plan to approach clients located in regions where there is still a low internet adoption rate?

While most parts of the world have quickly adopted the prevalent use of the internet, almost 2.4 billion people, or 55% of APAC’s population, remain offline according to data from the UN International Telecommunications Union. More than 3 billion people live further than 10 kilometres from high-capacity fibre optic cable infrastructure, resulting in these communities being unlikely to be able to access broadband internet.

A LEO satellite internet network can be set up and made usable comparatively quickly. The proximity to the Earth allows for faster internet speeds and low latency. As a result, it offers an ideal opportunity to support network expansion and provide internet coverage in rural areas while the rollout of fibre-optic infrastructure is in progress.

However, fibre remains superior to the alternative from space in terms of speed and latency. In addition, satellite internet-related infrastructure on the ground continues to depend on fibre. Satellites will not be able to completely replace the fibre optic network in the near future – but the satellite operators are probably not even aiming for this. On the contrary, it is becoming apparent that the greatest added value is created when both technologies exist side-by-side in a meaningful symbiosis and can benefit mutually from each other.

At the same time, it will be a long time before network coverage guarantees fibre-optic internet for everyone. Until then, satellites can help to remedy the situation. The situation is similar on the corporate side: For the coming years, satellite internet can transitionally be a tremendous asset for businesses in rural areas, allowing them to implement long overdue technological innovations. In the long term, however, there will be no way around the fibre-optic network here either.

Regardless, the digital economy is only set to flourish post-pandemic. Businesses have already had to ramp up their digitalisation efforts as consumers are increasingly turning to the online sphere for their day-to-day activities. According to a joint survey by Microsoft and IDC Asia Pacific, nearly 75% of organisations accelerated their pace of digitalisation due to the pandemic, alone in Singapore.

On top of this, SEA’s booming internet economy is set to grow to US$1 trillion by 2030, as millions of new internet users fuel online businesses in fields including e-commerce and virtual finance, according to a report jointly produced by Temasek, Google, and Bain. With that, it is only a matter of time before businesses in regions with low internet adoption rates join the interconnected world to leverage the bountiful opportunities in the space.

Governments and organisations have been investing in LEO satellite technology to help connect remote and rural areas, but the services are expensive – especially for those who live in those areas. How can DE-CIX help address this discrepancy?

LEO satellites are opening new frontiers in the delivery of the internet to regions of the world that have so far missed out on connecting to the digital superhighway. However, space network operators need to be able to connect to terrestrial digital ecosystems in order to deliver content to their end-users at as low latency as possible.

The DE-CIX Space-IX program supports satellite network operators through our interconnection on the ground, as well as our digital ecosystem of networks. By connecting to DE-CIX, LEO satellite operators will also have the option of becoming a further type of internet service provider in the digital ecosystem, alongside terrestrial and mobile networks.

As LEO satellites continue to grow in popularity, we will start to observe more operators entering the LEO satellite market. It is fair to assume overall costs of manufacturing and deployment of these satellites will reduce due to economies of scale, enabling governments and organisations to ensure that rural communities can enjoy efficient internet connectivity in the future.

Equally, the presence of an internet exchange in a region is known to bring down the costs of connectivity for the participating networks and their end users. This is because they can exchange data locally whenever possible, so they do not need to pay expensive transit fees to transport their data internationally. Enabling local data exchange also leads to greater digital participation, and this helps the local economy to grow, increasing tax revenues and encouraging new investments at these emerging hubs.

However, we also need to be clear about what an IX does: it enables networks to connect to one another locally. It has no direct influence on the pricing strategies of those networks, regardless of whether they are terrestrial, mobile, or satellite networks.

What are some of the most exciting developments in DE-CIX, specifically in the technologies you plan to adopt?

In the digital economy, flexibility is increasingly in demand so that the (up-to-the-minute) needs of companies in terms of connections to specific clouds and variable bandwidths can be met on-demand. This means that the automation of interconnection is an essential step in making it easy for networks of all kinds, and especially enterprise networks, to interconnect dynamically with their business partners, suppliers, service providers, cloud resources, and so on.

We launched the DE-CIX self-service portal in 2021 to enable just this, and we have had very positive feedback from connected networks, in particular from the enterprise segment. The portal and the DE-CIX API allow services to be provisioned and consumed across different networks. As well as being able to increase or decrease the bandwidth of connections and cancel connections at the press of a button, network automation via the DE-CIX API also enables the establishment of dedicated direct connections to the cloud.

Connecting directly to cloud resources means that no data needs to flow over the public internet, with the added benefit that the data travels along the shortest path, improving performance and latency. This is ideal for business-critical applications like managing transaction data, IoT, and artificial intelligence use cases, as well as for latency-sensitive applications drawn from the cloud, such as virtual desktop functionalities and video conferencing applications.

We are also seeing an increasing demand for the enablement of private and secure interconnection ecosystems, separated from the public internet, such as closed user groups. The service allows different actors to connect with their private networks via an internet exchange – particularly used for exchanging data only with selected trusted partners or for a dedicated service.