AI chatbots push data center networking to $118.94 billion
The increasing use of AI chatbots and agents is straining data center networking capabilities because AI workloads require significantly more data movement at faster speeds than traditional internet traffic. Networking providers, data center operators, and chip manufacturers are upgrading infrastructure with new gear, software, and increased capacity to meet the growing demand, forecasting the global data center networking market to reach $118.94 billion by 2033. Companies like Nvidia, Cisco, Digital Realty, Lumen Technologies, DE-CIX, and Flexential are investing in solutions such as InfiniBand and upgraded Ethernet to support AI's high bandwidth and low latency requirements, with some large companies beginning to build their own private AI data centers.
Key Takeaways
- Straits Research pegs the global data center networking market at $34.61 billion today and $118.94 billion by 2033.
- BNP Paribas says sales of back-end switches, which connect AI chips, could quadruple.
- IDC expects business investment in AI data center switches to rise from $127.2 million this year to $1 billion by 2027.
- Digital Realty CTO Chris Sharp said AI traffic in a machine-to-machine environment will be “monumental.”
- Lumen signed $5 billion in deals to provide fiber connectivity for Microsoft’s AI data centers and also has a deal with Meta Platforms.
Why It Matters
AI workloads are turning networking into a bottleneck, not just a support function: training and running models needs higher bandwidth, lower latency and more GPU-to-GPU traffic than traditional data center setups were built for. That is pulling in Nvidia, Cisco, Digital Realty, Lumen Technologies and DE-CIX, while some companies rely on cloud providers such as Microsoft and Amazon to absorb the upgrade burden. The clearest signal to watch is whether enterprises move from cloud-based experimentation to private data centers, as Cisco’s Kevin Wollenweber and Lumen’s Kate Johnson say that shift is still only in its early stages.
Read full article at livemint.com
Get this in your inbox → Subscribe
Enjoy our coverage?
Add StreamingMeme as a preferred source on Google to see more of our streaming news at the top of your Search results.
Add as preferred source