Data Center

Revenue in the Data Center market is projected to reach US$67.03bn in 2024.
Network Infrastructure dominates the market with a projected market volume of US$40.68bn in 2024.
Revenue is expected to show an annual growth rate (CAGR 2024-2029) of 6.25%, resulting in a market volume of US$90.78bn 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 & Western Europe is currently facing minimal growth, influenced by factors such as slow adoption of digital technologies, lack of awareness among consumers, and limited convenience in online services. This can be attributed to challenges in the Servers, Storage, and Network Infrastructure sub-markets, such as high costs, security concerns, and limited scalability. These factors are impacting the overall market's growth rate, hindering its potential for significant expansion in the near future.

Customer preferences: The demand for sustainable and eco-friendly data centers is on the rise in Central & Western Europe, as consumers become more conscious of their environmental impact. This trend is driven by a growing awareness of the carbon footprint of data centers and the need for renewable energy sources. Additionally, there is a shift towards energy-efficient and green data center designs, as well as a focus on reducing e-waste through recycling and responsible disposal of electronic equipment. This reflects a broader shift towards sustainability in consumer preferences and highlights the importance of environmental considerations in the data center market.

Trends in the market: In Central & Western Europe, the Data Center Market is experiencing a shift towards sustainable practices, with an increasing number of data centers utilizing renewable energy sources and implementing energy-efficient designs. This trend is driven by the region's commitment to reducing carbon emissions and achieving carbon neutrality. Additionally, there is a growing demand for edge computing solutions, driven by the rise of IoT devices and the need for low-latency data processing. These trends have significant implications for industry stakeholders, as they must adapt to meet the changing demands of the market and ensure compliance with environmental regulations. Furthermore, the adoption of edge computing may lead to a more distributed data center landscape, presenting new challenges and opportunities for data center operators.

Local special circumstances: In Central & Western Europe, the Data Center Market is heavily influenced by the region's strict data privacy regulations and high demand for secure and reliable data storage solutions. Additionally, the proximity to major business hubs and advanced telecommunications infrastructure has made the region a popular location for data centers. In countries like Germany and the Netherlands, where renewable energy is prioritized, data centers are also incorporating sustainable practices to meet the growing demand for environmentally-friendly solutions.

Underlying macroeconomic factors: The Data Center Market in Central & Western Europe is heavily influenced by macroeconomic factors such as technological advancements, government policies, and investment in digital infrastructure. Countries with strong government support and significant investments in data center facilities are experiencing faster market growth compared to regions with limited funding and regulatory challenges. Moreover, the increasing demand for data storage and management solutions due to the rise in data volumes and the adoption of cloud computing services are driving the growth of the market. Additionally, the growing adoption of advanced technologies such as AI and IoT is further fueling the demand for data center services 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.