Europe Data Center Colocation Market - Industry Outlook & Forecast 2023-2028

Europe Data Center Colocation Market - Industry Outlook & Forecast 2023-2028

The Europe data center colocation market is projected to reach an impressive USD 9.98 billion by 2028, reflecting strong growth and demand.

KEY HIGHLIGHTS

• The implementation of GDPR has spurred the adoption of cloud-based services for data localization, contributing to the growth of data center projects.
• While Brexit has notable implications for data centers in Western Europe, operators continue expanding infrastructure across the continent. The region made the maximum investments in 2022, with a share of 83% in Europe.
• In terms of colocation revenue, the UK is leading with a market share of over USD 2.6 billion generated in 2022, followed by the Netherlands and Germany. This surge in demand is due to the immense construction of new data centers and the expansion of existing facilities.
• The European colocation data center market attracts substantial investments, with Western Europe drawing global operators seeking to extend their presence. Favorable policies make the Nordics an attractive hub for investments.

Segmentation by Colocation Type

• Retail Colocation
• Wholesale Colocation

Segmentation by Infrastructure

• Electrical Infrastructure
• Mechanical Infrastructure
• General Construction

Segmentation by Electrical Infrastructure

• UPS Systems
• Generators
• Transfer Switches & Switchgear
• PDUs
• Other Electrical Infrastructure

Segmentation by Mechanical Infrastructure

• Cooling Systems
• Racks
• Other Mechanical Infrastructure

Segmentation by Cooling Systems

• CRAC & CRAH Units
• Chiller Units
• Cooling Towers, Condensers & Dry Coolers
• Economizers & Evaporative Coolers
• Other Cooling Units

Segmentation by Cooling Technique

• Air-based Cooling Technique
• Liquid-Based Cooling Technique

Segmentation by General Construction

• Core & Shell Development
• Installation & Commissioning Services
• Engineering & Building Design
• Fire Detection & Suppression
• Physical Security
• DCIM/BMS Solutions

Segmentation by Tier Standard

• Tier I & Tier II
• Tier III
• Tier IV

Segmentation by Region

• Western Europe
• UK
• Germany
• France
• Netherlands
• Ireland
• Switzerland
• Italy
• Spain
• Belgium
• Portugal
• Other Western European Countries
• Nordic
• Denmark
• Sweden
• Norway
• Finland & Iceland
• Central & Eastern European Countries
• Russia
• Poland
• Austria
• Czech Republic
• Other Central & Eastern European Countries

KEY TRENDS

Adoption of Artificial Intelligence

• Europe's rapid adoption of Artificial Intelligence (AI) drives economic growth through data generation and tech markets.
• Major companies like Bosch and Airbus are embracing AI for tasks like automation and pattern recognition, showcasing its potential.
• European governments are proactively supporting AI adoption.
• The UK's National AI Strategy and Germany's AI initiatives highlight concerted efforts. France plans to over USD 2.2 billion by 2025, while collaborations like India and Germany's AI partnership are boosting growth.

Rise in Sustainability Initiatives

• Prominent European data centers, such as Equinix, Interxion, and DigiPlex, are setting a renewable energy precedent, committing to powering facilities with 100% renewable energy.
• As part of the broader European Green Deal, European countries are actively participating in the European climate pact, targeting carbon neutrality by 2050.

Adoption Of Cloud-Based Services

• The adoption of cloud-based services is a significant driver behind the growth of data center investments in Europe. Cloud adoption has led to increased demand for data storage, scalability, compliance adherence, performance optimization, and hybrid/multi-cloud strategies.
• In May 2023, Hewlett Packard Enterprise (HPE) signed an MoU with the Crown Commercial Service (CCS) to provide GreenLake solutions for UK public services.
• OVHcloud reported 33.9% revenue growth from public cloud services in 2022.
• The UK's initiatives, such as the Local Digital Declaration, Technology Code of Practice, and Cloud First Policy, drive public cloud adoption.
• Government Supporting Data Center Development
• Government support plays a crucial role in fostering the development of data centers in Europe. Tax incentives, renewable energy benefits, and collaboration between data center operators and governments create a favorable environment for growth.
• European governments offer various incentives to promote data center investments:
• Many governments across Europe provide low corporate tax rates and waive withholding tax on dividends.

COMPETITIVE ANALYSIS

• The European data center colocation market is witnessing dynamic competition among global and local colocation data center operators.
• Countries with tax incentives, proper connectivity, favorable climates, and renewable energy sources are attractive to operators. Strategic location selection enhances operational efficiency and customer appeal.

Prominent Colocation Investors

• 3data
• 3S Group
• AQ Compute
• Artnet
• Aruba
• AtlasEdge
• atNorth
• Bahnhof
• Beyond.pl
• China Mobile
• ClusterPower
• Colt Data Centre Services
• CyrusOne
• DigiPlex (IPI Partners)
• Digital Realty
• DATA4
• Echelon Data Centres
• EcoDataCenter
• EdgeConneX
• Equinix
• Global Switch
• Iron Mountain
• Green Mountain
• IXcellerate
• KDDI
• Liberty Global
• Magenta Telekom (MTS)
• Neterra
• Netia
• Nautilus Data Technologies
• NDC-GARBE Data Centers Europe
• NTT Global Data Centers
• nLighten
• NTT Global Data Centers
• Orange Business Services
• Proximity Data Centres
• Pure Data Centres
• Rostelecom Data Centers
• Stadtwerke Feldkirch
• Stratus DC Management
• Global Technical Realty
• T5 Data Centers
• Telecom Italia Sparkle
• Vantage Data Centers
• Verne Global
• VIRTUS Data Centres (ST Telemedia Global Data Centres)
• VK Cloud Solutions
• Yandex
• Yondr

KEY QUESTIONS ANSWERED:

1. How big is the European data center colocation market?

2. What is the growth rate of the Europe data center colocation market?

3. What is the estimated market size in terms of area in the Europe data center colocation market by 2028?

4. What are the key trends in the Europe data center colocation market?

5. How many MW of power capacity is expected to reach the Europe data center colocation market by 2028?