Data Center Market Size and Share Analysis by Infrastructure Type (IT Infrastructure, Support Infrastructure, General Construction), Type (Co-Location, Hyperscale), End User (BFSI, IT and Telecom, Healthcare, Government and Defense) - Global Industry Demand Forecast to 2030

Market Overview

The data center market size stood at USD 263.34 billion in 2022, and it is expected to advance at a compound annual growth rate of 10.9% during 2022–2030, to reach USD 602.76 billion by 2030.

The exponential increase in data is the major factor that contributes to the growth of the market. Therefore, the demand for these centers is burgeoning due to the rising need for social, mobile, analytics, and cloud services around the world. The recent explosion in the usage of social media has boosted the construction of new centers, to store the gathered information.

Based on Infrastructure, IT Infrastructure Holds Largest Share

IT infrastructure is the highest revenue contributor in the market as it comprises server, storage, and network infrastructure, which are the backbone of such facilities. The demand for it will further grow in the future with an around 11.4% CAGR, allowing it to maintain its position in the market. Nowadays, businesses are shifting from their existing resources to well-equipped data centers, to enable better data management, as data analysis has become central to business growth as well as public good. In this regard, the concerns related to the efficient storage and privacy of data continue to propel the setup of IT infrastructure.

Hyperscale Data Centers – The Future of IT Industry?

As a result of the pandemic, cloud adoption is accelerating at a rapid pace. The IT sector has been colocating to hyperscale data centers, to enable better data management, having realized the dynamism of what can be done with data. Colocation has surged to the top of the queue for organizations all around the world when it comes to their IT infrastructure needs. Realizing the need for an efficient center to reduce barriers for customers and for higher margins, better data storage and management, higher security, and reliability, IT companies are moving toward hyperscale data centers.

Role of IT and Telecom Industry in Data Center Setup Is Growing

The IT and telecom industry is the largest shareholder in the data center market. With the swift uptake of cutting-edge technologies, such as IoT, cloud, and AI, data generation is ballooning. This data comes from mobile internet usage, personnel records, network equipment, server logs, billing activities, and social networks. To store such huge amounts of data, IT and telecom companies are renting space at such third-party facilities. With These solutions, IT and telecom companies can store and manage huge amounts of data securely and scale up or down the storage capacity as required.

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North America Dominates Market

North America has the leading position in the data center market, and it will hold the same position till 2030, with a value of USD 191.80 billion.

In North America, the U.S. holds the leading position, and it will grow with a CAGR of 8.4%, attributed to the existence of a large number of data centers. The U.S. has over 2,600 such centers, many of these in northern California, where many IT firms, such as Facebook, Google, Uber, Yelp, and Twitter, are headquartered. North America also has highly advanced, extensive, and efficient technological infrastructure.

Furthermore, the region's investment in research and development is quite strong, which will lead to the establishment of next-generation centers that are more technologically advanced and efficient in terms of managing information. It is also home to multiple data center infrastructure providers, which is a major contributor to the region's rapid expansion and market share.

The COVID-19 pandemic has contributed to the strong uptick in initiatives and investments in this industry across the globe. Furthermore, the adoption of cloud-based services by government agencies, as well as of online learning and contactless payments, helped the market grow. Therefore, during the pandemic, the number of data management centers increased globally. For instance, in 2021, there were nearly 8,000 such centers around the world, out of which around 33% are in the U.S. The IT sector is expected to spend approximately USD 222 billion in these facilities by the end of this year.

Europe is also growing at a considerable rate because it is one of the key hubs for technology in the world. The increasing adoption of AI, 5G, and VR is bringing a revolution to the regional enterprise technology market. Furthermore, for data centers and their colocation facilities, the major driver boosting the industry is the rising demand for IoT, big data, and cloud computing. There are more than 2,600 data centers in Europe. Western Europe is a more-developed region and, therefore, has a large number of colocation data centers and service providers.

Exponential Growth in Data Generation Boosts Infrastructure Demand

The efficient analysis of databases helps organizations grow, as they leverage this data to analyze historical patterns and make future decisions, accordingly. Businesses store, process, and use data to improve their products and services, maintain customer relations, and increase profitability. For this, businesses must be equipped to manage the incessantly growing data volumes.

More than 60% of the humans have access to the internet, and their every online activity creates data. Businesses in all industries use this digital information to collect information on customers, manage human resources, track inventory, and achieve much more. Each day, around 2.5 quintillion bytes of data are generated. Further, presently, more than 44 Zettabytes of data exists in the world, 70% of which is generated by users.

The rate at which information creation is growing has been more or less predictable. By 2025, there will be 175 Zettabytes of data in the global datasphere, including medical data. Thus, the spending on big data analytics by the healthcare industry could reach USD 79.23 billion by 2028.

Industry experts suggest that most companies with more than 10 employees collect some form of digitized data, and the larger ones utilize data for improving their marketing endeavors, transferring it internationally as well. Hence, the growth in data generation is expected to propel the demand for data centers for meeting the storage and processing requirements of companies.

In 2022, various data centers were under construction around the world, thus driving the demand for all kinds of associated products and services, such as engineering, procurement, and construction (EPC), IT hardware, and cooling and power supply apparatus.

Increasing Adoption of Latest Technologies in Data Centers

data center operators are using several advanced technologies to ensure the optimal efficiency and performance, including automation, IoT, AI, and the latest generators and UPS batteries. Moreover, tech companies are introducing various software to monitor the operation of data centers and provide information regarding various installed systems, such as generators and cooling systems. Moreover, the design of servers, switches, racks, and many other components is being modified in compliance with the Open Compute Project (OCP) standards.

Moreover, the data demands of modern businesses are increasing every day, in turn, creating an increasing need for data centers. For instance, many data centers are aiming to bring down infrastructure burdens, and are, therefore, migrating to the software-defined data center (SDDC) model. Here, virtualization technologies recreate the computing powers and storage in the software form. With server virtualization, data centers get the freedom to host multiple users on one server, by segmenting it, unlike the traditional approach of allocating one server to every user, which leads to operational inefficiency. This approach also make data storage scalable, as multiple servers are utilized to distribute the workload. This approach, thus, works as a cloud model, where the service provider can parcel out data storage and processing power on an ‘as required’ basis. Virtualization also optimizes efficiency by making sure the resources are utilized to their fullest.

Market Players Are Involved in Launching Advanced Solutions to Gain Competitive Edge

Players in the global data center market are engaged in launching advanced hardware and software components. For instance;

• In June 2021, NTT Ltd. launched Global Data Center Interconnect (GDCI), which is an integrated global network fabric service delivering secure private connections between the major cloud service providers and NTT’s data centers.
• In April 2022, Phison Electronics Corporation and Seagate Technology Holdings plc announced that they will expand their portfolio of SSDs, to enable data management centers to save on operational costs. This move was a response to the rising demand of corporate entities for higher-density, faster, and smarter storage infrastructure that can work with HHD storage to enable high-performance computing, hyperscale data centers, and AI to function efficiently.

Key Players in Data Center Market Are:

• Alphabet Inc.
• IBM Corporation
• Eaton Corporation plc
• Schneider Electric SE
• General Electric Company
• Carrier Global Corporation
• Siemens AG
• LG Electronics Inc.
• Fujitsu Limited
• Mitsubishi Electric Corporation

Market Size Breakdown by Segment

This fully customizable report gives a detailed analysis of the data center industry from 2017 to 2030, based on all the relevant segments and geographies.

Based on Infrastructure Type

• IT Infrastructure
  • Server
    • Server hardware
    • Cloud server
  • Storage
  • Network
• Support Infrastructure
  • Electrical infrastructure
    • Uninterruptible power supply (UPS) systems
    • Generators
    • Power distribution units (PDUs)
    • Transfer switches & switchgear
  • Mechanical infrastructure
    • Cooling systems
      • By equipment
        • Computer room air conditioning and computer room air handling (CRAC and CRAH) units
        • Chiller units
        • Cooling towers, condensers, and dry coolers
        • Economizers and evaporative coolers
      • By technique
        • Air-based cooling techniques
        • Liquid-based cooling techniques
        • Racks
• General Construction
  • Core & shell development
  • Installation & commissioning
  • Engineering & building design
  • Fire detection & suppression
  • Physical security
  • Data center infrastructure management/building management system (DCIM/BMS)

Based on Type

• Co-Location
• Hyperscale

Based on Industry

• Banking, Financial Services, and Insurance (BFSI)
• IT and Telecom
• Healthcare
• Government and Defense

Geographical Analysis

• North America
  • U.S.
  • Canada
• Europe
  • U.K.
  • Germany
  • France
  • Netherlands
  • Switzerland
  • Italy
  • Spain
• Asia-Pacific
  • China
  • India
  • Japan
  • Australia
  • New Zealand
• Latin America
  • Brazil
  • Mexico
  • Chile
  • Colombia
• Middle East and Africa
  • Saudi Arabia
  • Turkey
  •  U.A.E.