In a new game of interconnection Latency is the New Currency

Society and businesses around the globe are entering a new era of digitalization in which digital applications and services will be needed everywhere, for everyone. The year 2021 heralds the beginning of the most exciting digital decade since the original boom of the commercial Internet. Beyond the virtual desktop and video streaming, we are seeing the emergence of digital applications and services across many sectors. As these become more sophisticated and assume increasingly critical roles within society, the more essential it becomes to ensure their performance in terms of secure and resilient digital infrastructure. Ivo Ivanov, the CEO of DE-CIX International, operator of the largest neutral interconnection ecosystem, reflects on how latency is becoming the new currency and how it will coin business strategies around the globe going forward.

Regardless of the duration of the ongoing global pandemic, accelerated digitalization in enterprises will be one of the key factors for future economic growth. As economic activity moves from the analog to the digital sphere, there is one thing that digital applications—ranging from the virtual desktop to e-health, e-manufacturing, and the digital car—all have in common: they all depend on the purely physical characteristics of the speed of light.

When we think of the speed of light, we normally imagine something inconceivably fast, imperceptible. But we really can feel it when data needs to travel too far. Put simply; this is what causes the lag we experience with pan-oceanic or long-distance video conferencing and calls.

Latency is decisive for the performance of general purpose and critical applications

This delay may only be less than a second long, but it’s still not the same as communicating in real-time. Such delays are a result of the distance that data—with example our audio and video signals, packaged digitally and sent across cyberspace—need to travel around the world. In the digital infrastructure industry, we call this “latency”. To ensure the best performance, latency needs to be minimized, meaning that digital applications need to get closer to the users.

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