As demand for AI-driven workloads, machine learning, and cloud-based inference grows exponentially, a new category of cloud providers has emerged to meet these unique needs: neoclouds.
Neoclouds often leverage Graphics Processing Units (GPUs) to deliver specialized computing power and infrastructure designed for high-performance AI and other resource-intensive applications. The global GPU-as-a-Service (GPUaaS) market is projected to reach $12.26 billion by 2030, driven by rising adoption across industries such as healthcare, fintech, and autonomous vehicles. These providers fill a critical gap in the market by offering scalable, flexible, and high-capacity solutions for rapidly evolving AI technologies, positioning themselves as key enablers in the future of cloud computing.
Previously focused on powering Bitcoin and cryptomining operations, a rapidly scaling neocloud provider shifted its business model to support high-performance AI and HPC (High-Performance Computing) workloads. They deliver cost-efficient, scalable GPU infrastructure by harnessing otherwise stranded energy sources while reducing carbon emissions. Their innovative approach positioned them as a leader in the emerging neocloud space. But as demand for AI capabilities surged, there was a clear need for permanent, large-scale data centers optimized for AI workloads.
The neocloud provider sought a robust, scalable, and flexible connectivity solution to manage the increasing demand for AI-driven workloads and sustainable cloud infrastructure. They partnered with Zayo to tackle unique network connectivity challenges including connections to remote locations, high-capacity demands, and the need for low-latency connectivity. Using Zayo’s tailored solutions, strategic collaboration, and expert deployment, the customer effectively manages current needs while laying the groundwork for future growth.
The Challenge: Getting Network to the Power
In the U.S., the power demand from existing and planned data centers is expected to surpass utility supply by approximately 50%, highlighting a significant energy gap. To address the energy challenge, the customer focuses on rural areas with access to affordable energy sources, such as wind and natural gas. Choosing locations based on energy availability is both cost-effective and practical, but requires collaboration with a skilled network provider to overcome connectivity challenges. As Harold Kwan, VP of Sales at Zayo, puts it: “We’re bringing connectivity to the power. While it’s a complex task, it’s far easier than relocating the power itself.”
We’re bringing connectivity to the power. While it’s a complex task, it’s far easier than relocating the power itself.
The neocloud provider encountered unique challenges as they expanded their operations, including:
- Increasing Demands for Power and Space: With AI workloads driving global demand for compute power, the company required substantial power and space and transitioned to larger data centers. The AI boom has increased competition for data center space in urban areas, where regulatory restrictions, zoning laws, and power grid limitations already pose a significant hurdle for data center development.
- Connectivity for Remote Locations: Establishing large-scale data centers in energy-abundant but remote locations posed significant challenges. Connecting these facilities to high-capacity networks with low latency was critical to supporting compute-intensive applications like AI model training and inference.
- Immediate Needs vs. Future Scalability: The customer needed a partner capable of addressing urgent connectivity requirements while supporting long-term growth into new regions across North America and globally.
- Flexibility and Custom Solutions: Traditional network providers struggled to meet the customer’s unique needs, such as deploying high-capacity networks to previously unconnected rural sites. The customer needed a partner with the adaptability and creativity to develop custom solutions quickly.
The Solution: Flexibility and Scalability
Zayo customized solutions to align with the company’s immediate needs and long-term goals, empowering it to address challenges seamlessly and at scale.
1. Custom-Built Network Solutions
Zayo provided IP Transit and Wavelength solutions with route diversity to connect the company’s emerging and existing data centers. By offering tailored routes and leveraging its expansive network, Zayo ensured scalability and reliable performance.
2. An Agile Approach
Unlike other network providers, Zayo took an agile approach to understanding and addressing the client’s unique needs. Zayo’s team:
- Responded quickly to requests, acting as an extension of the neocloud provider’s team.
- Instead of relying on a one-size-fits-all solution, Zayo collaborated closely with the customer to design multiple network footprint options aligned with their needs and goals.
- Worked collaboratively to find solutions for highly remote areas, where network builds require innovative strategies. For example, Zayo worked with local providers to deliver last-mile and Type 2 connectivity where needed.
3. Transparency and Partnership
It’s no longer all about price; it’s really about the solutions, the flexibility, and the time to deliver.
The relationship between Zayo and the customer grew from price-focused to future-focused. By aligning with the client’s vision and focusing on long-term planning, Zayo demonstrated its commitment to the customer’s success. As Cynthia Johnston, Sales VP at Zayo, explained, “It’s no longer all about price; it’s really about the solutions, the flexibility, and the time to deliver.” This shift solidified Zayo as a trusted partner invested in the neocloud provider’s success.
4. Scalability at Speed
Zayo is committed to delivering fast, flexible, and high-quality solutions to meet the evolving needs of our customers. By addressing infrastructure gaps and preparing for future growth, we ensure speed and scalability are at the core of every solution. This approach allowed us to support this customer in overcoming their network challenges and achieving their business goals.
As top AI providers expand to emerging markets to take advantage of more affordable power costs, Zayo is staying ahead of the curve. We’re optimizing our network to deliver seamless connectivity, no matter where the growth happens. By aligning our fiber infrastructure with power-rich geographies, we’re ensuring our customers get fast, reliable connections to fuel their success — wherever they go.
Results
Through its ongoing partnership with Zayo, the company has achieved measurable success in addressing its connectivity challenges:
- Rapid Expansion Across Key Regions: Zayo’s infrastructure enables the customer to consider scaling operations into virtually any state in the U.S. and an extensive international footprint as well.
- Streamlined Rural Deployments: Zayo established high-capacity, low-latency connectivity, enabling the company to deliver neocloud solutions more effectively.
- Future-Proof Growth Plans: Zayo’s extensive network infrastructure, bolstered by continuous investments such as adding over 5,000 fiber miles, empowered the neocloud provider to scale their AI workloads effortlessly. By eliminating the scalability challenges often linked to rural deployments, Zayo ensures seamless support for AI-driven innovation.
- Increased Bandwidth: Zayo’s 100G Waves and IP Transit deliver ultra-high bandwidth, allowing neocloud providers to handle massive data loads required for AI training, large-scale analytics, and high-performance computing.
- Enhanced Connectivity: Through our extensive network of Points of Presence (PoPs) and optimized routes, Zayo ensures low-latency, high-quality connectivity. Neocloud providers gain better service responsiveness, particularly relevant for latency-sensitive applications like gaming, live streaming, and AI inference.
By leveraging Zayo’s expertise and tailored connectivity solutions, the company successfully navigated its transition to large-scale GPU deployments and AI-driven neocloud infrastructure. With plans to expand further into additional North American and international markets, their partnership with Zayo will remain pivotal in ensuring continued growth and innovation.
Zayo’s ability to provide agility, scale, and custom solutions defines us as a key partner in the rapidly emerging neocloud and GPU-as-a-Service space.