Data Center

Revenue in the Data Center market is projected to reach US$574.80m in 2024.
Network Infrastructure dominates the market with a projected market volume of US$364.20m in 2024.
Revenue is expected to show an annual growth rate (CAGR 2024-2029) of 5.24%, resulting in a market volume of US$742.20m by 2029.
In global comparison, most revenue will be generated United States (US$123.20bn in 2024).

Definition:

The Data Center market is a critical segment of the technology industry focusing on supplying and managing physical infrastructure necessary for hosting and operating IT systems, primarily servers, storage, and network equipment. This market spans from traditional in-house data centers to sophisticated facilities offered by specialized providers, covering services like hosting, shared data center facilities, and managed data center solutions. It targets a diverse client base, ranging from small businesses to large enterprises, offering flexible, scalable solutions for their IT infrastructure needs. This sector is integral to the efficient functioning and security of IT operations in various organizations.

Structure:

The Data Center market is structured in three markets based on the services model provided by the companies.

The Server market covers the resources and services related to servers, integral for hosting websites, managing databases, and supporting cloud computing.
The Storage market covers the resources and services related to data storage systems, crucial for archiving, data backup, and ensuring data recovery.
The Network Infrastructure market covers the resources and services related to network hardware essential for ensuring connectivity, data transmission, and network security.

Additional Information:

The Data Center market includes revenue, revenue change, average spend per employee, and key player market shares as key performance indicators. Market values represent revenues paid to primary vendors at the manufacturer price level either directly or through distribution channels (excluding VAT). Revenues are generated through both online and offline sales channels and include spending by consumers (B2C), enterprises (B2B) as well as governments (B2G). Detailed definitions of each market can be found on the respective page where the market data is displayed.

Key players in the Data Center market include companies such as Dell, HPE, Huawei, and Ericsson.

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Network Infrastructure, such as Cisco Routers and Switches, and Arista Network Ethernet Switches
Infrastructure Firewalls, such as Palo Alto Network Next-Generation Firewall, and Fortinet FortiGate Firewalls
Servers, such as Dell PowerEdge Servers, HPE ProLiant Servers, and IBM Power Systems
Storage, such as Dell EMC Storage Solutions, and NetApp Data Storage Systems

IT Infrastructure for Private Environments, such as VMware vSphere, and Cisco UCS
Software, such as Microsoft Windows Server, and Red Hat Enterprise Linux
Cloud Hosting Services, such as AWS, Microsoft Azure, and GCP
Network Infrastructure Services, such as IT Support Services, and Home Internet Services Providers (ISPs)

The Data Center market in Central America is experiencing minimal growth, influenced by factors such as limited investments in servers, storage, and network infrastructure, as well as slow adoption of digital technologies and low health awareness among consumers. Convenience offered by online health services is not a major driver in this region.

Customer preferences: The Data Center Market in Central America is experiencing a shift towards cloud-based solutions, as companies seek to reduce their physical infrastructure and improve operational efficiency. This trend is driven by the growing adoption of digital transformation strategies and the need for remote access and management of data. Additionally, the rise of remote work and virtual collaboration has led to an increased demand for reliable and secure data storage and processing capabilities. This has resulted in a surge in demand for data centers that offer advanced cloud-based solutions, further driving the growth of the market.

Trends in the market: In Central America, the Data Center Market is experiencing a shift towards cloud-based services, as businesses look to reduce costs and increase efficiency. This trend is supported by the region's growing internet penetration and government initiatives to promote digitalization. As a result, there is a rise in demand for Data Center as a Service (DCaaS) solutions. This trend is significant as it allows businesses to access advanced IT infrastructure without the need for large upfront investments. However, it also poses a challenge for traditional data center providers who must adapt to the changing market. Furthermore, this trend highlights the potential for growth in the region's data center market, with projections showing a CAGR of 11.3% from 2020 to 2025. Industry stakeholders must take note of these trends and adapt their strategies to stay competitive in this evolving market.

Local special circumstances: In Central America, the Data Center Market is on the rise due to the region's strategic location, low cost of operations, and growing demand for digital services. The countries in this region have unique geographical and cultural factors that contribute to the market's growth, such as the high concentration of tech-savvy young population and growing government support for digital transformation. Additionally, the region's regulatory environment, with incentives for foreign investments and favorable tax policies, has made it a hub for data center operations.

Underlying macroeconomic factors: The growth of the Data Center Market is heavily influenced by macroeconomic factors such as technological advancements, government policies, and investment in digital infrastructure. Countries with strong economic growth and supportive policies for the development of data centers are witnessing a surge in market demand. On the other hand, nations with limited resources and regulatory challenges are likely to experience slower market growth. Furthermore, the increasing adoption of cloud computing and big data analytics is also driving the demand for data centers in the region.

Data coverage:

The data encompasses B2B enterprises. Figures are based on hardware-related expenses of businesses for setting up and maintaining an IT infrastructure.

Modeling approach / Market size:

Market sizes are determined through a top-down approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use annual financial reports and national statistical offices. In addition, we use relevant key market indicators and data from country-specific associations, such as GDP and level of digitization. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques, such as exponential trend smoothing and the S-curve function, is based on the behavior of the relevant market.

Additional notes:

The data is modeled using current exchange rates. The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic and the Russia-Ukraine war is considered at a country-specific level.

This report presents a comprehensive analysis and additional information on the Technology market, in a PDF format.

Although data centers may not make front page news, they serve a critical role as the infrastructure powering the most exciting developments in tech. While data centers were once known as small rooms housed on-site by business users, they have increasingly become extensive, centralized facilities managed by multinational operators. Many organizations rent data center capacity from a so-called colocation provider such as Equinix or Digital Realty, while others subscribe to cloud subscription services to take care of their storage and compute requirements. The global market was forecast to bring in 344 billion U.S. dollars in 2024, propelled by the adoption data intensive technologies.