Global Data Center Market Landscape 2024-2029

Global Data Center Market Landscape 2024-2029

The global data center market by investment is expected to grow at a CAGR of 8.19% from 2023 to 2029.

KEY TRENDS

Sustainability Initiatives on the Rise

The popularity of green energy is increasing worldwide and is expected to grow. It is crucial to fully adopt green energy resources as soon as possible due to the destructive impacts of climate change and global warming. In recent years, Middle Eastern countries such as the UAE, Saudi Arabia, Qatar, Turkey, Bahrain, Jordan, and Kuwait have been working to incorporate renewable energy into their energy generation. In Europe, the Nordic region is known for its sustainable practices, with wind farms and solar panels widely used to generate clean energy. North America and the Asia-Pacific region are also embracing this trend, focusing on more sustainable practices, and many companies are setting net-zero carbon emissions targets for the next two to three decades.

Rise in Rack Power Densities

The power density of equipment racks is a critical factor in data center design, planning, cooling, and power supply. In recent years, there has been a significant increase in the power density of IT equipment racks. This is due to the growing demand for high-performance computing (HPC), driven by the adoption of converged and hyper-converged solutions and virtualization. The average rack power density will increase to 10 to 12 kW in the coming years. The surge in data center deployments reflects the increasing demand, with projections indicating a 50% increase in power usage by 2025 and a five-fold growth in global data generation from 2019 to 2025. To keep up with this rapid growth, the data center market must maximize efficiency by fitting more computing power into each rack or square foot. Over the past decade, there has been a clear trajectory from modest power densities of 4–5 kW per rack to today's densities exceeding 50 kW. Modern applications and data volumes drive rack density to unprecedented levels.

Governments Aiding Data Center Development

The growth of the data center market is observed in countries offering tax incentives. Many state and local governments provide investments and sales tax incentives to attract data center operators. In China, tax incentives such as VAT exemptions on equipment and reduced CIT rates for local investments have played a crucial role in fostering the growth of data centers. India's Data Centre Policy, which grants infrastructure status to the sector and state-level incentives such as reduced electricity duties, aims to encourage investment in the data center market. In Germany, incentives focus on compliance with GDPR and outsourcing IT equipment, creating a conducive environment for data center investment. The UK has invested in renewable energy sources and digital information protection laws to attract data center projects.

Heightened Demand for Cloud-based Services

1.The demand for digital transformation in businesses has significantly increased the uptake of cloud-based services in the marketplace. The market has seen a swift escalation in adopting cloud computing applications and services, driving the development of extensive hyperscale cloud data centers. This surge in cloud computing is transforming the landscape of the data center market within the area, prompting numerous innovations and the integration of advanced infrastructure.

2.Significantly, the growth in the usage of cloud services is fueled by leading providers, including Google, Amazon Web Services, Microsoft, Alibaba Cloud, Oracle, Tencent Cloud, and IBM. These cloud service providers enable organizations to store information, operate software, and utilize computing resources via the Internet, reducing dependence on traditional data centers. The shift towards cloud platforms brings myriad benefits, such as enhanced flexibility, scalability, and cost-effectiveness, positioning it as a favored option across various sectors like IT, telecommunications, manufacturing, retail, logistics, healthcare, and government bodies.

SEGMENTATION ANALYSIS

Segmentation by Facility Type

• Hyperscale Data Centers
• Colocation Data Centers
• Enterprise Data Centers

Segmentation by Infrastructure

• IT Infrastructure
• Electrical Infrastructure
• Mechanical Infrastructure
• General Construction

Segmentation by IT Infrastructure

• Server Infrastructure
• Storage Infrastructure
• Network Infrastructure

Segmentation by Electrical Infrastructure

• UPS Systems
• Generators
• Transfer Switches & Switchgear
• Power Distribution Units
• 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, and Dry Coolers
• Economizers & Evaporative Coolers
• Other Cooling Units

Segmentation by Cooling Techniques

• Air-based
• Liquid-based

Segmentation by General Construction

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

Segmentation by Tier Standard

• Tier I & II
• Tier III
• Tier IV

GEOGRAPHICAL ANALYSIS

• Regarding investment, North America leads the global data center market, with consistent growth, year on year. From 2020 to 2029, the region will oversee a significant increase in investments, with a CAGR of 6.73%. North America, particularly North Virginia, also known as the 'Data Center Capital of the World,' is the epitome of the data center market, boasting the highest concentration of facilities on a global scale, with several data center facilities. Locations like Ashburn in Loudoun County, Virginia, and other states like Texas, California, Arizona, Illinois, Georgia, Oregon, and New York/New Jersey are key hotspots, attracting major colocation and hyperscale operators.
• While North America remains the dominant data center market player in investment and power capacity, its eastern counterpart- the APAC region, has also emerged as a key industry, experiencing substantial investment growth during the forecast period. With a CAGR of 10.25%, the APAC displays robust data center-centric development driven by countries such as India, China, Australia, and Japan. Adopting artificial intelligence (AI) and increasing investments from data center operators have contributed significantly to the region's growth trajectory. Southeast Asian countries such as Malaysia, Indonesia, and even Singapore stand out as significant investors, with anticipated acceleration in investments from these nations in the coming years.

Segmentation by Geography

• North America
• The U.S.
• Canada
• Latin America
• Brazil
• Chile
• Mexico
• Colombia
• Argentina
• Rest of Latin America
• Western Europe
• The U.K.
• Germany
• France
• Netherlands
• Ireland
• Switzerland
• Italy
• Spain
• Belgium
• Portugal
• Other Western European Countries
• Nordics
• Denmark
• Sweden
• Norway
• Finland
• Iceland
• Central & Eastern Europe
• Russia
• Poland
• Austria
• Czech Republic
• Other CEE Countries
• Middle East
• UAE
• Saudi Arabia
• Israel
• Oman
• Qatar
• Jordan
• Bahrain
• Kuwait
• Other Middle East Countries
• Africa
• South Africa
• Kenya
• Nigeria
• Egypt
• Ethiopia
• Other African Countries
• APAC
• China
• Hong Kong
• Australia
• New Zealand
• India
• Japan
• South Korea
• Taiwan
• Rest of APAC
• Southeast Asia
• Singapore
• Indonesia
• Malaysia
• Thailand
• Philippines
• Vietnam
• Other Southeast Asia Countries

COMPETITIVE LANDSCAPE

• In the North American region, well-known construction contractors like AECOM, Arup, and Turner Construction are capitalizing on the burgeoning data center market, supported by the expansion efforts of major colocation operators such as Equinix, Digital Realty, CyrusOne, QTS Realty Trust, STACK Infrastructure, NTT DATA, Aligned Data Centers. In addition, hyperscale tech giants like Amazon Web Services (AWS), Google, Meta (Facebook), and Microsoft are aggressively expanding their footprint, particularly in regions like Northern Virginia and Texas, paving the way for further construction activities.
• Latin America presents a dynamic data center market landscape with established and emerging contenders. Colocation operators such as Ascenty and ODATA (Aligned Data Centers) are spearheading the development of multiple data center facilities. ABB, Stulz, Vertiv, and several other infrastructure companies are crucial in facilitating construction activities and ensuring efficient operations across regions worldwide. The entry of new players, such as Layer 9 Data Centers and CloudHQ, has also widened the data center market’s horizons.
• Western Europe has construction contractors like Atkins, Deerns, Dornan, ISG, Mercury, and several others competing for opportunities in a data center market dominated by established colocation operators such as Colt Data Centre Services (COLT DCS), Equinix, STACK Infrastructure, Digital Realty, and others. Major hyperscale operators such as Google, Microsoft, and Meta continue to invest confidently, driving up the demand for construction services. New players entering the data center market, such as Global Technical Realty and Stratus DC Management, bring dynamism to the industry, fueling competition and innovation.

IT Infrastructure Vendors

• Arista Networks
• Atos
• Broadcom
• Cisco Systems
• Dell Technologies
• Hewlett Packard Enterprise (HPE)
• Huawei Technologies
• IBM
• Lenovo
• NetApp
• DataDirect Networks (DDN)
• Extreme Networks
• Fujitsu
• Hitachi Vantara
• Infortrend Technology
• Inspur
• Intel
• Micron Technology
• MiTAC Holdings
• NEC
• Nimbus Data
• Oracle
• Pure Storage
• Seagate Technology
• Silk (Kaminario)
• Supermicro
• Synology
• Toshiba
• StorCentric
• QNAP Systems
• Quanta Cloud Technology
• Quantum (Pivot3)
• Western Digital
• Wiwynn

Support Infrastructure Vendors

• ABB
• Caterpillar
• Cummins
• Delta Electronics
• Eaton
• Legrand
• Rolls-Royce
• Schneider Electric
• STULZ
• Vertiv
• 3M
• Airedale
• Alfa Laval
• Asetek
• Assa Abloy
• Bloom Energy
• Carrier
• Condair
• Cormant
• Cyber Power Systems
• Daikin Applied
• Enlogic
• FNT Software
• Generac Power Systems
• Green Revolution Cooling (GRC)
• HITEC Power Protection
• Honeywell
• Johnson Controls
• KOHLER
• KyotoCooling
• Mitsubishi Electric
• Munters
• Natron Energy
• NetZoom
• Nlyte Software
• Panduit
• Piller Power Systems
• Rittal
• Siemens
• Trane
• Tripp Lite
• Yanmar (HIMOINSA)
• ZincFive

Data Center Contractors

• AECOM
• Arup
• Corgan
• DPR Construction
• Fortis Construction
• Holder Construction
• Jacobs
• Mercury
• Red Engineering
• Rogers-O’Brien Construction
• Syska Hennessy Group
• Turner Construction
• Turner & Townsend
• AlfaTech
• Atkins
• Aurecon
• Basler & Hofmann
• Black & Veatch
• BlueScope Construction
• Brasfield & Gorrie
• CallisonRTKL
• Cap Ingelec
• Clark Construction Group
• Climatec
• Clune Construction
• COWI
• DC PRO Engineering
• Dornan
• Edarat Group
• Ehvert
• EMCOR Group
• EllisDon
• EYP MCF
• Gensler
• Fluor Corporation
• Gilbane Building Company
• HDR
• HITT Contracting
• Hoffman Construction
• ISG
• JE Dunn Construction
• Kirby Group Engineering
• kW Engineering
• Laing O’Rourke
• Linesight
• M+W Group (Exyte)
• McLaren Construction Group
• Morrison Hershfield
• Mortenson
• PM Group
• Quark
• Rosendin
• Royal HaskoningDHV
• Salute Mission Critical
• Sheehan Nagle Hartray Architects
• Skanska
• Southland Industries
• Sturgeon Electric Company
• Structure Tone
• Sweco
• The Mulhern Group
• The Walsh Group
• The Weitz Company
• TRINITY Group Construction
• Urbacon

Data Center Operators

• 21Vianet Group (VNET)
• Amazon Web Services (AWS)
• Apple
• AUBix
• China Telecom
• Colt Data Centre Services (Colt DCS)
• Compass Datacenters
• CyrusOne
• Digital Realty
• Equinix
• GDS Services
• Global Switch
• Google
• Iron Mountain
• Meta (Facebook)
• Microsoft
• NTT DATA
• STACK Infrastructure
• ST Telemedia Global Data Centres
• Vantage Data Centers
• 3data
• AdaniConneX
• Africa Data Centres
• AirTrunk
• Aligned Data Centers
• American Tower
• AQ Compute
• Aruba
• AtlasEdge
• atNorth
• AT TOKYO
• BDx (Big Data Exchange)
• Bulk Infrastructure
• CenterSquare
• CDC Data Centres
• Chayora
• China Mobile
• Chindata
• CloudHQ
• Cologix
• COPT Data Center Solutions
• CtrlS Datacenters
• Data4
• DataBank
• DC BLOX
• Digital Edge DC
• Digital Parks Africa
• Echelon Data Centres
• EdgeConneX
• Edge Centres
• EdgeUno
• Element Critical
• ePLDT
• eStruxture Data Centers
• fifteenfortyseven Critical Systems Realty (1547)
• Flexential
• Green Mountain
• Gulf Data Hub
• H5 Data Centers
• HostDime
• IXcellerate
• Hyperco
• KDDI (Telehouse)
• Keppel Data Centres
• Khazna Data Centers
• LG Uplus
• maincubes SECURE DATACENTERS
• Milicom (Tigo)
• Nabiax
• Nautilus Data Technologies
• NEXTDC
• Open Access Data Centres
• Orange Business Services
• OVHcloud
• Pi Datacenters
• Prime Data Centers
• PowerHouse Data Centers
• Princeton Digital Group (PDG)
• Proximity Data Centres
• Pure Data Centres Group
• QTS Realty Trust
• Quantum Switch Tamasuk (QST)
• Raxio Data Centres
• Rostelecom Data Centers
• Sabey Data Centers
• Scala Data Centers
• Sify Technologies
• Skybox Datacenters
• SpaceDC
• Stream Data Centers
• SUNeVision (iAdvantage)
• Switch
• T5 Data Centers
• Tenglong Holdings Group
• Telecom Italia Sparkle
• TierPoint
• TONOMUS (ZeroPoint DC)
• Turkcell
• Urbacon Data Centre Solutions
• Wingu Africa
• YTL Data Center
• Yondr
• Yotta Infrastructure (Hiranandani Group)

New Entrants

• Agility
• Cloudoon
• ClusterPower
• Corscale Data Centers
• Crane Data Centers
• EDGNEX Data Centres by DAMAC
• DHAmericas
• Edged Energy
• Evolution Data Centres
• Form8tion Data Centers
• Gatineau Data Hub (AVAIO Digital Partners)
• Gaw Capital
• Global Technical Realty
• Kasi Cloud
• Layer 9 Data Centers
• Quantum Loophole
• Regal Orion
• Rowan Digital Infrastructure
• Stratus DC Management
• Surfix Data Center
• YCO Cloud

KEY QUESTIONS ANSWERED:

1.How big is the data center market?

2.What are the key trends in the data center industry?

3.What is the growth rate of the global data center market?

4.What is the estimated market size in terms of area in the global data center market by 2029?