Edge Data Centers are changing the internet geography!

Online streaming of video content is increasing all over the world and thus is giving a tough time to those offering cable TV or satellite services. At this juncture, the physical nature of internet infrastructure is also changing as businesses are consuming more and more cloud services versus buying hardware boxes and software licenses. Whether your drug is ‘How I met your mother’ on Netflix or ‘FireFly’ on Amazon Prime, the web content companies are doing everything to make sure you can binge on high definition at the earliest. The same applies to cloud services, for whom performance at the users’ end really matters.

Therefore, in recent years, online content service providers have been busy to improve the quality of these high-bandwidth consuming content to users outside of the top metros like New York, Los Angeles or San Francisco. And the best way to do so, is caching the most popular content or web application data on servers closer to the so called “ tier-2 markets” places like Phoenix, Minneapolis, or St Paul. This makes the content readily available close to the users and is immediately accessible as per their demand.

Therefore, caching the content closer to users is also creating a new category of data center service providers that call their facilities “Edge Data Centers”. These facilities operate only for delivering video content via internet and operate on the concept of “Edge” which is different from the traditional internet hubs in places like New York, Northern Virginia, Dallas, or Silicon Valley.

Thus, architecting something that can be truly called an “edge data center” requires a different set of considerations than building your standard collocation facility.

Here, the emphasis will be more on creating interconnection ecosystems in cities away from the traditional core markets.

Edge Connex, 365 data centers, vXchange are all examples of edge data centers. And FYI, the EdgeConneX went from zero data centers two years ago, to two dozen today and is still growing. Also vXchange bought eight SunGard data centers for the sole purpose of offering video streaming via cache.

Moreover, some edge data centers are also involving in practices of exchanging traffic with other content providers in edge data center industry to better manage their networks.

At the same time, the demand dynamics are also changing the design and expansion strategy of these edge data centers. Previously, a company whish started small with 1.2 megawatt power consumption has scaled up to consume 10 megawatts in 2 megawatts chunks in just 2 years. This surely says the way these data centers are offering cached video content to users are growing in business perspective.

Keeping the growth prospects in line, a typical customer starts with about 30 kW to cache content that is on great demand in a specific market. As their requirements grow overtime, and reach about 50 kW, they start caching infrastructure with a network node of their own. Once they gain a node of their own, they start looking at 100kW deals with the provider that can eventually grow into 200kW deployments.

But to expand at these great velocities the companies need a great investment and that depends on how well they are flourishing in the market of video content streaming.

Remember—“All that glitters is not gold!”


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