Data Center

Revenue in the Data Center market is projected to reach US$95.74bn in 2024.
Network Infrastructure dominates the market with a projected market volume of US$63.56bn in 2024.
Revenue is expected to show an annual growth rate (CAGR 2024-2029) of 8.96%, resulting in a market volume of US$147.10bn 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 China is experiencing mild growth, driven by factors such as increasing demand for digital infrastructure, growing awareness of data security, and the convenience of online services. This growth is further impacted by the sub-markets of Servers, Storage, and Network Infrastructure, which are all seeing steady demand in the region.

Customer preferences: The growing demand for digitalization and data-driven solutions in China's rapidly expanding data center market is influenced by cultural shifts towards convenience and efficiency. With the rise of e-commerce and online services, consumers are increasingly reliant on digital platforms for everyday tasks, leading to a surge in demand for cloud-based storage and computing solutions. This trend is further amplified by the increasing adoption of smart devices and Internet of Things (IoT) technology, driving the need for data centers to support and manage these devices. Additionally, the shift towards remote work and virtual meetings in the wake of the pandemic has also accelerated the demand for data centers as businesses seek reliable and secure digital infrastructure for their operations.

Trends in the market: In China, the Data Center Market is experiencing a surge in demand for cloud services, driven by the rapid growth of e-commerce, social media, and other online activities. This trend is expected to continue as the country becomes more digitally connected and businesses increasingly rely on data storage and processing. As a result, data center operators are investing in advanced technologies and expanding their capacities to meet the growing demand. This presents opportunities for industry stakeholders, but also raises concerns about energy consumption and sustainability in the long run.

Local special circumstances: In China, the Data Center Market is flourishing due to the country's rapid digital transformation and the government's focus on developing a robust digital infrastructure. With a population of over 1.4 billion, China has a massive demand for data storage and processing. Additionally, the country's strict regulations on data privacy and security have led to the emergence of advanced data center technologies and services. The local culture of innovation and entrepreneurship has also contributed to the growth of the data center market in China.

Underlying macroeconomic factors: The Data Center Market in China is heavily influenced by macroeconomic factors such as government policies, technological advancements, and investments in infrastructure. China's strong economic growth and increasing demand for digital services have led to a rapid expansion of the data center market. Additionally, the Chinese government's support for innovation and the development of new technologies has created a favorable environment for data center investments. Furthermore, the growing digital economy and increasing adoption of cloud computing are also driving the demand for data center services in China. As China continues to invest in its digital infrastructure, the data center market is expected to experience continued growth in the coming years.

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.