As companies begin to address the demands of the artificial intelligence (AI) era, the shift to higher-capacity bandwidth is accelerating, leading to wavelength and dark fibre purchases surging, with 400G wavelengths dominating investments, research from Zayo has revealed.
Surveying its user base’s consumption habits, the global internet network provider examined network bandwidth purchasing trends, focusing on key drivers, industry behaviours and shifting priorities from 2020 to 2024 across more than 1,800 of its North America customers using dark fibre, wavelengths and network connectivity products. It also included a survey of 16 decision-makers from large enterprises with over 1,500 employees on their bandwidth needs and purchasing motivations.
The study showed that overall wavelength capacity purchased grew 2.8x from 2020 to 2024, with metro dark fibre purchases rising 268% in this time and long-haul dark fibre purchases climbing 52.6% year-over-year (YoY) from 2023 to 2024. In 2024, 400G wavelengths accounted for the largest total terabits (Tb) purchased, substantially outpacing traditional 10G and 100G services.
Another key finding was that the large companies, such as hyperscalers and carriers, were consuming the clear bulk of high-capacity infrastructure. Between 2020–2024, these firms made 91.2% of all metro dark fibre purchases and 66.8% of all wavelength deals exceeding 1Tb of capacity. The data showed a growing trend toward deals of over 1Tb of wavelength capacity. In 2024, over twice as many customers purchased more than 1Tb of wavelength capacity compared with 2020, led by repeat buyers.
The average big-deal buyer made 11 such purchases in 2020. By 2024, that number increased to 15 deals on average per buyer, showing a growing demand for high capacity among this group. In 2024, 61.91% of all wavelength capacity was purchased by just 10 buyers – all hyperscalers or carriers.
Looking at individual industry’s needs, hyperscalers, carriers, and software and technology industries were mostly purchasing higher capacity to fuel digital innovation, relying on massive bandwidth to power cloud services, datacentres and next-generation technologies that serve businesses of all sizes. Manufacturing was boosting bandwidth through rising demands as Industry 4.0, including real-time analytics, the internet of things and AI combined to drive the need for higher-capacity infrastructure. Other industries such as media, finance and hospitality were investing in more capacity to meet growing bandwidth needs.
Not surprisingly, AI was found to be the primary bandwidth driver. AI use cases were seen as spurring a record number of large-scale wavelength and fibre purchases, predominantly by hyperscalers, software and tech companies. Purchase considerations were evolving with AI adoption. Enterprises were prioritising scalability, hybrid cloud optimisation, and security for sensitive workloads, while balancing cost and performance.
Zayo noted that as data demands continue to grow with increased AI and technology adoption, so too will the bandwidth needed to support it.
The research found that some industries have seen standout growth in total wavelength capacity purchased during the 2020–2024 period. Specifically, manufacturing saw a 364% growth in capacity from 1.88Tb to 8.71Tb. The public sector witnessed 261% growth to total 1.96Tb. Datacentres saw a 326% uptick growing from 2.68Tb to 11.42Tb, while the software and technology sector was responsible for a huge 450% growth, leading to a total consumption of 52.15Tb at the end of 2024.
An interesting development was that emerging datacentre markets were exploding in terms of network traffic. Demand for long-haul routes and metro wavelength connectivity skyrocketed in new markets of Memphis and Salt Lake City, increasing by 4,300% and 348.28% YoY, respectively, from 2023 to 2024. Attributing reasons for this, Zayo noted that these cities offer affordable and available space and power, catalysing investment.
