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 Data Center market in GCC is experiencing subdued growth, influenced by factors such as increasing adoption of cloud-based technologies, rising demand for data storage and network infrastructure, and the convenience offered by online services. Despite slower growth, the market is expected to continue expanding in the coming years due to the region's growing digital landscape.

Customer preferences: As the GCC region continues to rapidly urbanize and modernize, there is a growing demand for cloud-based services and data storage solutions. This is driven by the increasing adoption of digital technologies, such as Internet of Things (IoT) devices and smart home systems. Additionally, the rise of e-commerce and online shopping has led to a surge in demand for data centers to support the growing volumes of online transactions. This trend is expected to continue as consumers become more reliant on digital services for their daily needs.

Trends in the market: In the GCC region, the Data Center Market is experiencing a surge in demand for cloud computing services, with businesses increasingly relying on these solutions for data storage and management. Additionally, there is a growing trend towards the adoption of edge computing, as companies seek to reduce latency and improve network performance. These developments are significant as they indicate a shift towards more advanced and efficient data management practices. For industry stakeholders, this means a greater focus on investing in cutting-edge technologies and infrastructure to keep up with the evolving market landscape. It also highlights the need for continual innovation and adaptation to meet the changing needs of businesses in the region.

Local special circumstances: In GCC, the Data Center Market is experiencing rapid growth due to the region's increasing digital transformation and the government's focus on building a knowledge-based economy. The market is also driven by the unique geographical and cultural factors of the region, such as the high demand for cloud services due to extreme weather conditions and the emphasis on data privacy and security in the region's conservative society. Additionally, the regulatory landscape in GCC, with its favorable tax policies and government support for technology infrastructure, has attracted global data center players to invest in the region.

Underlying macroeconomic factors: The GCC data center market is heavily influenced by macroeconomic factors such as government initiatives to promote digital transformation, increasing investments in smart city projects, and growing demand for cloud services. Favorable economic conditions, such as stable GDP growth and rising disposable incomes, are also driving the demand for data center services in the region. Additionally, the rising adoption of emerging technologies like AI, IoT, and big data analytics is further propelling the growth of the data center market in the GCC.

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.