Switzerland Data Center Storage - Market Share Analysis, Industry Trends & Statistics, Growth Forecasts (2024 - 2029)

Switzerland Data Center Storage - Market Share Analysis, Industry Trends & Statistics, Growth Forecasts (2024 - 2029)

The Switzerland Data Center Storage Market size is estimated at USD 655.20 million in 2024, and is expected to reach USD 772.30 million by 2029, growing at a CAGR of 3.51% during the forecast period (2024-2029).

The increasing demand for cloud computing among SMEs, government regulations for local data security, and growing investment by domestic players are some of the major factors driving the demand for data centers in the country.

• Under Construction IT Load Capacity: The upcoming IT load capacity of the Switzerland data center market is expected to reach 670 MW by 2029.

• Under Construction Raised Floor Space: The country's construction of raised floor area is expected to increase to 2.6 million sq. ft by 2029.

• Planned Racks: The country's total number of racks to be installed is expected to reach 130,000 units by 2029. Zurich is expected to house the maximum number of racks by 2029.

• An increasing need for data storage has resulted in an upsurge in the number of data centers nationwide. Several factors contribute to the demand for data centers and their growth within Switzerland, which is reflected by the country's evolving IT landscape, business activities, and technological initiatives. Key drivers that propel the development of data centers in the nation include Digital Transformation, Cloud Computing Adoption, E-commerce & Digital Services, Renewable Energy & Sustainability, and Smart Cities & IoT Initiatives. Hence, such factors are expected to drive market growth during the forecast period.

Switzerland Data Center Storage Market Trends

IT & Telecommunication Segment Holds the Major Share

• The Switzerland data center storage market has also been driven by growing cloud use across companies because of their increasing integration of emerging technologies like artificial intelligence, big data, and blockchain. Cloud computing (anything-as-a-service (XaaS)) continues to be one of the most important trends in the Swiss IT industry. However, while most cloud solutions are still deployed in-house (besides traditional outsourcing and managed services), software-as-a-service (SaaS), in particular, is becoming increasingly important as a procurement model.

• In 2022, private clouds were most commonly used (63%), and public and hybrid clouds were on par with shares of 28% each. However, hybrid scenarios continue gaining popularity as companies seek to offer an IT services mix customized per individual preferences.

• Globally leading hyperscalers, namely AWS, Google, and Microsoft, now have a presence in Switzerland. Since 2019, they invested intensively in developing their Swiss cloud regions and attracting new customers. For instance, AWS plans to invest USD 5.9 billion into the local economy through 2036. The 15-year investment plan will help drive local cloud adoption and add USD 16.3 billion to the Swiss GDP. In 2021, cloud expenditure in Switzerland was more than CHF 4.93 billion (USD 5.42 billion).

• By 2022, only a few companies, approximately 5%, were not using any cloud services, suggesting an upward trend and growing demand for data processing facilities. Additionally, scalable and strong cloud networks are being developed with the help of hyperscale data centers, which can enhance customer satisfaction, increase availability, and cut costs. Considering the above developments, the cloud data center segment is expected to account for most of the Swiss data center market capacity by 2029.

• Additionally, in Telecom, rising 4G adoption and the impending 5G wave are encouraging telecom companies to make investments in the Swiss data center market. In 2021, 99% of the population was covered by LTE (4G). By the end of 2022, Swisscom reached 98% of the population with 5G and transmission rates of up to 1 Gbps and 31% with 5G+ and transmission rates of up to 2 Gbps, while Sunrise UPC covered over 96% with 5G and transmission rates of up to 1 Gbps. In 2023, over 90% of homes and companies in the country were connected to Swisscom's ultra-fast broadband services. Such instances in the market are expected to create more need for data centers, resulting in rising demand for data center storage solutions in the coming years.

Hybrid Storage is Expected to Hold a Significant Market Share

• The combination of on-premises and cloud storage solutions is called hybrid storage in data centers. This approach leverages the strengths of both environments, offering the flexibility to store and manage data on-site and in the cloud.

• Switzerland is an international finance center with a significant presence in the Financial Services sector. Banks have a strong data center requirement to perform activities such as banking, trade, and compliance with finance regulations. In Switzerland, organizations may be concerned about the location of their data. In addition, hybrid solutions allow businesses to retain vital data on-premises while benefiting from the benefits of cloud computing services regarding non-sensitive data.

• As a place for businesses that need to be globally integrated and interconnected with their data center services, the country is an excellent location due to its connectivity and geographic position. Cloud components enable global reach, while on-premises infrastructure can cater to local needs.

• Furthermore, factors such as growing connectivity and online shopping would contribute to the increasing generation of data and processing facilities. The country's internet penetration increased from 89% in 2016 to 96% in 2021, while at the same time, the number of smartphone users increased from 6.9 million in 2016 to 7.9 million in 2021.

• In 2021-22, online shopping was found to be preferred by about 11% of Swiss customers, and this share was expected to reach around 40% in 2023. Such improvements in the market propel the growth of data centers and, consequently, the rise of demand for DC storage in the country.

• The key players in the market focus on improving the data center storage solutions to meet the market demand. In July 2023, Hitachi Vantara, a prominent infrastructure, data management, and digital solutions subsidiary of Hitachi Ltd, announced its collaboration with Microsoft to launch the Hitachi Unified Compute Platform (UCP) for Azure Stack HCI. The powerful and streamlined hybrid cloud solution increases business flexibility and delivers enhanced cloud management across various environments, including data centers, branch offices, and edge computing, to give businesses greater visibility and control over how their data is stored, managed, and used.

Switzerland Data Center Storage Industry Overview

The upcoming DC construction projects in the country will increase the demand for Switzerland's data center storage market in the coming years. The Switzerland data center storage market is moderately consolidated with some players in the market, including Dell Inc., Hewlett Packard Enterprise, Huawei Technologies Co. Ltd, Hitachi Vantara LLC, and Kingston Technology Company Inc. These major players, with a prominent market share, focus on expanding their regional customer base.

• June 2023: Huawei announced the launch of its new innovative data center data infrastructure architecture, F2F2X (Flash-to-Flash-to-Anything). It assists financial institutions in tackling new data, new applications, and new resilience challenges; this architecture serves as a reliable source of information.

• February 2023: NetApp, a significant, cloud-led, data-centric software company, announced the expansion of NetApp AFF C-Series, a new product line of capacity flash storage that delivers lower-cost all-flash storage, and NetApp AFF A150, a new entry-level storage system in the AFF A-Series line of all-flash systems.

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