Structural Shift: India must keep pace with the changing digital network architecture

Hyperscalers spent $24 billion on data centre capital expenditure globally in 2015. By 2025, that figure had reached $380 billion in a single year, a 15-fold increase in a decade. This is not simply a story of data centre growth. It is a structural shift in who is driving demand, what that demand requires from connectivity infrastructure and how fundamentally the architecture of digital networks must change as a result.

Data centre connectivity has three layers:

• Inter-country, which is primarily subsea cables;
• Intercity, or national long-distance (NLD) links connecting major hubs; and
• Intra-city, covering metro core and last-mile connectivity.

Artificial intelligence (AI)-led investment is disrupting all three simultaneously, creating exponential requirements at every level of the stack.

The subsea cable transformation

For decades, subsea cables were funded and controlled by telco consortia. Bharat Sanchar Nigam Limited (BSNL) was the Indian landing partner for the first generation of international cables. That model has been replaced. The four major hyperscalers now co-own over 57 sea cables across the world that have landed, are landing or are in the process of being built. Cables such as Waterworth, Blue Raman and 2Africa are among the most well known.

Where older cables carried a handful of fibre cores, new hyperscaler-backed cables carry dozens, pushing capacity from terabits towards petabits. For India specifically, cables including IEX, IAX, MIST, 2Africa, Blue Raman and SMW 6 are all adding capacity, with Visakhapatnam emerging as a significant new landing hub alongside Mumbai and Chennai.

Why older NLD fibre is no longer adequate

India’s rapid physical infrastructure development over the last 15 years, across highways, metro rail, bridges, and water and gas pipelines, has had a damaging and underappreciated effect on the national fibre network. Every time a duct is excavated and relocated, the fibre cable inside is disturbed. Cuts accumulate, reflections introduce signal loss, and the usable distance and capacity of older cables degrades. The result is that fibre cables deployed as recently as 10 years ago are no longer able to carry the latency-sensitive, high-capacity traffic that AI workloads and inter-data centre connectivity require. The need is not for more fibre in the abstract. It is for new fibre, built to current standards, in corridors that matter. This has to be matched with policy delivery.

Rethinking network architecture

Traditional telco networks were designed for vertical, download-oriented traffic, from core to edge. The data centre era requires the opposite. Inter-data centre horizontal traffic, moving between data centres within a cluster, across clusters within a city and between cities, is now the dominant traffic pattern. A hyperscaler running AI workloads in Mumbai today requires each of its data centres within a cluster to be connected to every other via three geographically diverse paths, with no physical overlap between them.

Cluster-to-cluster connectivity requires the same redundancy. A single 144-core fibre cable serving multiple purposes is no longer adequate. Dedicated inter-DC fibre, separate from enterprise access and tower backhaul, running across multiple ducts with spare capacity built in, is the baseline requirement.

This is why relying on incumbent telcos to build this infrastructure presents structural challenges. A telco is simultaneously an infrastructure provider, a data centre operator and a bandwidth seller to end- customers.

Conflict of interest is inherent. Neutral infrastructure providers, who have no end-customer relationships and no competitive stake in what rides on top of the fibre, are better positioned to defray build costs across multiple customers, maintain long-term fibre quality and provide equal access to all carriers.

What India needs to get this right

Four things are required:

• A national data centre connectivity master plan covering key corridors, utility-grade fibre alongside power and gas infrastructure, and a digitised map of existing assets.
• Accessible fibre infrastructure capital that moves in step with data centre investment commitments.
• Next-generation deployment standards including higher capacity, more ducts, lower latency and future-proofing built in from day one, because right-of-way is the hardest cost to incur twice.
• A neutral host model that removes single-carrier control, distributes risk and ensures that the underlying digital infrastructure serves the entire ecosystem equally.

The gigawatts of data centre capacity being committed to India over the next five to six years will only deliver its full value if the connectivity infrastructure to light and link it is built in parallel. That build is the defining infrastructure challenge of this decade.