The Equinix Q4 2023 Earnings were announced on February 14th.  Things were busy in Q4 for Equinix and Q1 2024 appears to be following the same trend.  On January 24th of this year, Equinix announced a partnership with NVIDIA called Equinix Private AI with NVIDIA DGX .  This is a fully managed private cloud service that includes NVIDIA DGX systems, NVIDIA networking and the NVIDIA AI Enterprise software platform. Equinix installs and operates each customer’s privately owned NVIDIA infrastructure and can deploy services on their behalf in one of its global data centers.

This AI as a Service provides a turnkey, ready-to-run AI development platform, hardware, connectivity, security and management. Customers leverage the DGX software stack, DGX cluster, Equinix Fabric, NVIDIA DGX validated Storage, InfiniBand networking, and Equinix secures and manages the environment through the OS.

This is a differentiated service for Equinix that meets a demand in the market.  Customers, particularly those in highly regulated industries like finance and healthcare want to move proprietary data privately while ensuring security and compliance requirements are met.  These same Enterprise clients have been dabbling with AI and understand the hardware, software and infrastructure complexity.  They want flexibility.  They want speed. They want interoperability.  They need to solve for latency sensitive workloads. In short they want an end to end software platform for production AI

If you are wondering who is jumping into the AI as a Service pool from a customer standpoint, it looks to be like lots of folks are diving in. Markets and Markets reports that  the global AI as a Service Market size was worth around $9.3 billion in 2023 and is anticipated to reach over $55.0 billion by the end of 2028. The math tells us there will be a 42.6% growth in a five year period.

There is substantial money to be spent by the enterprise with this all in one approach to AI.

This is the first step for Equinix to really explore the adjacencies that are possible in a broader AI ecosystem.

Equinix is in a great position to bring together AI tools, box them up and put a bow on them for their Enterprise clients

Here are 4 Ways That Equinix Private AI with NVIDIA DGX Delivers Value:

Less CapEx and More Opex—All costs, including hardware, software, space, power, cooling, connectivity, security, management and support through the OS is included and provided on a monthly bill.  Customers begin with a 3 year contract

Easier Deployment—In partnership with Nvidia, the customer receives a custom scope and the environment is stood up and deployed by Equinix.

Scalability— The joint solution is offered in Silicon Valley and Northern Virginia with additional locations globally being added

Access to Innovation–With the service, customer have access to the NVIDIA library of frameworks and pretrained models, such as NVIDIA Riva® for speech AI, NVIDIA Merlin™ for recommendation engines, NVIDIA Clara™ for medical imaging, and more.

It’s expected that earlier adopters of AIaaS will be organizations taking advantage of Computer vision (CV) technologies that replicate the human visual ability in a computer or machine. Computer vision technology is being intensively used in many sectors, including retail, healthcare, agriculture, manufacturing, etc.

There are many potential use cases.  Here are three.

In Healthcare we’ll see Computer Vision used for Medical Image Analysis— A computer vision-based system can accurately analyze x-rays, CT scans, MRIs, and other medical images to identify abnormalities such as tumors, blood clots, etc., that are not visible to the human eye.

A second use case in Manufacturing is Quality Control. A common use case for CV in manufacturing due to the repetitive nature of the task and potential for error. Computer vision QA systems can work with much higher speed and accuracy and save manufacturing facilities time and money.

In Retail– Smart stores surveillance where CV enable cameras monitor shelves and customers. Additionally, we’ll see more cashier-less stores with the help of CV.

Looking forward to learning of more emerging uses cases and to hear more of this story unfold with the Q1 2024 Earnings call in a few months.

https://www.marketsandmarkets.com/Market-Reports/artificial-intelligence-ai-as-a-service-market-121842268.html#:~:text=%5B301%20Pages%20Report%5D%20The%20global,period%20(2023%2D2028).

cc: Jordan Stewart

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