Data Center - GCC

Revenue in the Data Center market is projected to reach US$3.22bn in 2024.
Network Infrastructure dominates the market with a projected market volume of US$2.25bn in 2024.
Revenue is expected to show an annual growth rate (CAGR 2024-2029) of 6.15%, resulting in a market volume of US$4.34bn by 2029.
In global comparison, most revenue will be generated in the United States (US$123.20bn in 2024).

Key regions: United States, Germany, India, Japan, China

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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Market

Region

Region comparison

Currency

Analyst Opinion

The GCC Data Center market is facing subdued growth, influenced by factors such as increasing demand for digital technologies, growing consumer awareness of health, and the convenience of online health services. These factors impact all sub-markets, including Servers, Storage, and Network Infrastructure, driving overall market growth.

Customer preferences: As societies in the GCC region become increasingly digitally connected, there is a growing demand for data center services to support the growing use of online platforms and digital applications. With the rise of e-commerce and online banking, consumers are also placing a higher value on data security and privacy, creating a need for robust data center solutions. This trend is further fueled by the increasing reliance on remote work and online education, highlighting the need for reliable and fast connectivity for individuals and businesses alike.

Trends in the market: In the GCC Data Center Market, there is a current trend of using renewable energy sources to power data centers. This trajectory is driven by the increasing demand for sustainable solutions and the region's abundant solar resources. This trend has significant implications for industry stakeholders, as it can reduce operational costs and improve the environmental footprint of data centers. Furthermore, this move towards renewable energy aligns with the GCC's goals of diversifying its economy and reducing reliance on fossil fuels. It also presents opportunities for renewable energy companies to enter the data center market and collaborate with data center providers in the region.

Local special circumstances: In the GCC region, the Data Center Market is experiencing rapid growth due to the increasing demand for cloud computing, big data analytics, and artificial intelligence. This growth is fueled by government initiatives to diversify economies and reduce reliance on oil. Additionally, the region's favorable regulatory environment and strategic location connecting Europe, Africa, and Asia have made it an attractive market for international data center operators. The unique cultural and business practices in the GCC, such as the importance of personal relationships and face-to-face interactions, have also shaped the market dynamics and customer expectations in this region.

Underlying macroeconomic factors: The Data Center Market in GCC is greatly impacted by macroeconomic factors such as technological advancements, government policies, and investment in IT infrastructure. With the growing demand for digital transformation in the region, countries with favorable regulatory environments and strong investment in IT infrastructure are experiencing faster market growth. Additionally, the increasing adoption of cloud computing, big data analytics, and IoT technologies in various industries is further fueling the demand for data center services in the region. This trend is expected to continue as the region strives to become a global technology hub.

Methodology

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.