China Data Center Market - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

China Data Center Market - Growth, Trends, Covid-19 Impact, and Forecasts (2023 - 2028)

The China Data Center Market is anticipated to register a CAGR of 19.2% during the period. Increasing demand for supercomputing and phenomenal growth in e-commerce and hi-tech industries will drive market growth.

• China is highly focusing on taking the lead over global peers in data center construction, with larger enterprises looking to scale up their data centers for ensuring stability and reliability of data services, as the application of 5G, wearable devices, the internet of things, and artificial intelligence spur a burgeoning demand for computing power.
• Growing demand from enterprises is expected to propel the growth of cloud computing and other associated data services in the country. Also, advancements in data center technology and its integration with other associated benefits are the key driving factors for China's growth.
• Moreover, conventional industries are supported by policies to embrace digital transformation and enhance their adoption of IT technologies. Hence, their demand for internet data center services is also rising, further driving the market growth.
• Data centers that support businesses, internet services, and social media lives use lots of energy. As their numbers grow, there is pressure to make them more energy-efficient and reduce their environmental impact.
• COVID-19 altered the way people used technology and network services. Before the pandemic, heavy demands on digital infrastructure primarily centered in large businesses and institutions like schools and hospitals, with personal networks also receiving fair use. Now, with much of the workforce and many students dispersed into private residences, digital infrastructure must provide reliable support across a range of networks and cope with substantial changes in demand.

• Increasing efforts to construct data centers at a large scale to meet the accelerating demand from enterprises to scale up their data center operations is influencing the market demand. The development of the telecommunication industry and the rapid growth of internet users in the country are expected to boost the demand for China's data center market.
• In order to fulfill the high computational power requirements of businesses, the application of cutting-edge technologies like the internet of things, artificial intelligence, and machine learning, as well as the rollout of 5G technology, increases the demand for dependable data services.
• One of the most significant supercomputers in the world is located in China, and there is a great need for quick processing performance for business applications. The building of data centers in the nation is being fueled by the escalating efforts being made by the top authorities to make China one of the world's preeminent powerhouses.
• Moreover, adopting internet technology in the private and public business sectors promotes the country's digital transformation. The proliferation and adoption of online payment gateways, mobile wallets, and net banking by consumers and the rise in the number of IT players operating in the province are expected to fuel the China data center market growth.

• Datacenter value is increasing due to China's fifth-generation mobile telecommunications technology advancement and the thriving e-commerce industry. The e-commerce industries are embracing digital technology to improve business operations. Currently, both commercial and non-commercial activities are carried out via e-commerce services by more than 70% of the people in China.
• The market demand is anticipated to be impacted by an increase in the number of market players using the online sales channel as a medium to sell the items and extend their consumer base to enhance the reach of their products globally.
• While the market participants are making investments to give clients a tailored shopping experience by purchasing different data analytics tools and software to improve the services provided to the customers, customers enter their personal information along with contact and delivery details to make easy deliveries of products, which is expected to drive the need for data centers to store and manage the data efficiently. They hold vast amounts of data for processing and generating insights to keep marketing strategies ahead.
• The growth of mobile payment systems has catalyzed these e-commerce companies' desire for data center infrastructures. Data centers are also widely employed in e-commerce to lower overall operational complexity while boosting flexibility, scale, and efficiency.

The competitive rivalry in the China data center market is moderate due to the presence of some significant firms, including China Mobile and Alibaba Group Holding Limited. They have a competitive advantage over other players thanks to their capacity to continuously reinvent their goods.

In April 2022, Alibaba Cloud and VMware released the next iteration of their jointly developed public cloud service, Alibaba Cloud VMware Service, to assist organizations throughout China in accelerating their digital transformation. The service promises to help Chinese organizations migrate and modernize applications more quickly and shift workloads between on-premises VMware infrastructures and Alibaba Cloud at scale.

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