The world has become data-driven; from small and medium-sized enterprises to large enterprises, all kinds of businesses now rely on data to enhance their processes, improve their performance, and generate greater profits. The dependence on digital services has increased over time as more people have acquired internet connectivity.
Organizations have become more resilient to equipment problems, malicious parties, and operational costs, by utilizing data centers. Such places facilitate the storage of data on third-party services, offering security, connectivity, and space. Thus, in 2021, all construction of data centers was a $220-billion industry, and it is expected to acquire $343.6 billion in revenue by 2030.
Get More Insights: Data Center Market Segmentation Analysis Report
A data center facilitates organizations to offload their infrastructure and resources for data processing, communications, and storage offsite. It provides systems for storing, accessing, sharing, and processing the data, along with utilities, such as cooling, uninterrupted power supply, and network security access.
The surge in the usage of IoT and the technologies associated with it is putting heavy strain on data centers. To cater to this requirement, numerous such facilities are required to be upgraded. The cost involved in building and maintaining a data center is exponentially higher. It is a big challenge to keep the facility fully optimized, at the same time reducing downtime, alleviating latency, and ensuring compliance with the ever-evolving standards.
Colocation and Hyperscale Data Centers Are Growing Global Trends
Colocation data centers facilitate organizations with the solution for renting space to host their data. Businesses can rent server racks only or complete purpose-built modules in multi-tenant data centers. It provides the same benefits as having companies’ own data centers without spending that much on IT operations, thus allowing them to augment their profits.
Similarly, a hyperscale data center houses critical computing and network infrastructure, providing big companies, such as Google, Microsoft, and Amazon, the power to deliver key services to customers worldwide. In addition, hyperscale data centers provide better data management, higher security, and reliability, reduce barriers for customers, and allow them to generates higher margins.
Why BFSI Sector Is Depending Increasingly on Data Centers?
The digitization of the banking sector and increase in the internet penetration due to the decline in the cost of internet connections and surge in the count smartphone users have led to a rise in the number of customers utilizing internet banking and mobile banking.
Along with this, the UPI technology has also become popular in recent years, as vendors and customers can use it for digital transactions even for low-cost products and services. Such small digital transactions made by a large number of people create massive data daily. This data needs to be collected to keep a record of digital activities in the BFSI sector, thus leading to an increase in the requirement for data centers around the world.
Therefore, the surge in worldwide data creation with the penetration of the internet leads to an increase in the demand for data centers for better management of this data.
Hyperscale Data Centers – The Future of IT Industry?
The global data center market size was about $220.0 billion in 2021, which is likely to increase with a CAGR of 5.1% to $343.6 billion by 2030. A significant increase in data is a principal factor contributing to the market growth. The key reasons the demand for these facilities is increasing with each passing day include the rising usage of social, mobile, analytics, and cloud services. Recently, there is an explosion in the use of social media platforms, which calls for the development of data centers to store all the data.
IT infrastructure contributes the highest revenue in the data center market as it includes server, storage, and network infrastructure, which are the mainstay of such facilities. The demand for these components will further intensify in the future with around 5% CAGR. At present, businesses are shifting their data from their existing on-premises servers to data centers to allow for better data management, as data analysis has become integral to business growth, in addition to the public good.
IT Infrastructure Is Dominating Market
Mergers and acquisitions in the industry have augmented significantly in the last few years. Multi-billion-dollar acquisition deals are common in the data center market at present. Apart from this, in 2020, a record $31 billion was spent across more than 110 mergers and acquisitions in the sector. The rising demand for data center capacity has made way for big mergers and acquisitions, which has led to a fresh wave of private cash flow into the technology sector, while also funding the growth of cutting-edge centers in developing countries.
The fast-increasing data generation is one of the key factors for the growth of the data center market. In 2020, 64.2 zettabytes of data were created, which was 314% more than 2015. Experts predict that by 2025, nearly 10 times more data will be generated than in 2017. Additionally, around 2.5 quintillion bytes of data are generated every day, worldwide. With the rapid adoption of IoT and social media platforms, about 90% of the data in the world was produced in the past four to five years.
Mergers and Acquisitions Key Characteristics of Market Competitive Landscape
North America had the largest share, of around 40%, of the market in 2021, and it will grow at a significant CAGR in the industry. The U.S. possesses more than 2,600 such centers, many of which are situated in northern California, which is home to the headquarters of many IT firms. including Google, Facebook, Uber, Twitter, and Yelp. North America also has highly innovative, extensive, and efficient technological infrastructure, which offers opportunities to companies offering various components and services for the construction of such facilities.
The COVID-19 pandemic has contributed to the strong growth of the data center market globally. Additionally, the adoption of cloud-based services by government agencies, along with online learning and contactless payments, aided in the growth of the market. Thus, the number of data management centers increased during the pandemic. For instance, in 2021, there were nearly 8,000 such centers around the world. The U.S. the U.K., Germany, China, Canada, and the Netherlands had most of them.
Hence, the industry boomed amidst the pandemic due to the rise in the volume of data because of the burgeoning usage of online platforms.
The research offers market size of the global data center market for the period 2017–2030.
Infrastructure Type
- IT Infrastructure
- Server
- Storage
- Network
- Support infrastructure
- Electrical infrastructure
- UPS systems
- Generators
- Transfer switches & switchgear
- PDUs
- Others
- Mechanical infrastructure
- Cooling systems
- By system type
- CRAC & CRAH units
- Chiller units
- Cooling towers, condensers, & dry coolers
- Economizers & evaporative coolers
- Others
- By cooling technique
- Air-based
- Liquid-based
- By system type
- Racks
- Others
- Cooling systems
- General construction
- Core & shell development
- Installation & commissioning
- Engineering & building design
- Fire detection & suppression
- Physical security
- DCIM/BMS solutions
- Electrical infrastructure
End User
- BFSI
- IT and Telecom
- Healthcare
- Government and Defense
- Others
Region
- North America Data Center Market
- By infrastructure type
- By end user
- By country – U.S. and Canada
- Europe Data Center Market
- By infrastructure type
- By end user
- By country – Germany, France, U.K., Netherlands, Ireland, Switzerland, Italy, Spain, Belgium, Luxembourg, Portugal, Denmark, Norway, Sweden, Finland, Iceland, Poland, Austria, and Rest of Europe
- Asia-Pacific (APAC) Data Center Market
- By infrastructure type
- By end user
- By country – China, Australia, India, Japan, South Korea, New Zealand, Taiwan, and Rest of APAC
- Latin America (LATAM) Data Center Market
- By infrastructure type
- By end user
- By country – Brazil, Mexico, Chile, Colombia, and Rest of LATAM
- Middle East and Africa (MEA) Data Center Market
- By infrastructure type
- By end user
- By country – U.A.E., Saudi Arabia, Turkey, Israel, Oman, Qatar, Kuwait, Jordan, Bahrain, and Rest of MEA
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