Data Center

Revenue in the Data Center market is projected to reach US$1.34bn in 2024.
Network Infrastructure dominates the market with a projected market volume of US$835.10m in 2024.
Revenue is expected to show an annual growth rate (CAGR 2024-2029) of 5.21%, resulting in a market volume of US$1.73bn 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 Hong Kong is experiencing minimal growth due to various factors, such as limited space for expansion, rising costs, and increasing competition from neighboring countries. Despite this, the market is still driven by the increasing demand for cloud services and the growing need for data storage and processing. The sub-markets of Servers, Storage, and Network Infrastructure play a crucial role in shaping the overall market, with each facing unique challenges and opportunities. Overall, the market is expected to continue its slow but steady growth, driven by the country's strong economy and government support for digital transformation.

Customer preferences: Consumers in Hong Kong are increasingly prioritizing sustainability and energy efficiency in their choice of data centers. This is driven by concerns about the environmental impact of traditional data centers and the rising costs of energy. As a result, data center providers are investing in renewable energy sources and integrating energy-efficient technologies into their operations. This trend is expected to continue as consumers become more environmentally conscious and companies prioritize sustainability in their business practices.

Trends in the market: In Hong Kong, the Data Center Market is experiencing a surge in demand for cloud services, with more companies adopting a hybrid cloud approach to optimize their operations. This trend is driven by the increasing need for data storage and management solutions, as well as the growing reliance on digital transformation strategies. As a result, the market is seeing a rise in investments in data center infrastructure, with a focus on energy efficiency and sustainability. This trend is significant for industry stakeholders as it presents opportunities for growth and innovation, while also posing challenges in terms of data security and regulatory compliance. Additionally, with the rise of edge computing and Internet of Things (IoT) devices, the demand for edge data centers is also on the rise, further shaping the trajectory of the Data Center Market in Hong Kong.

Local special circumstances: In Hong Kong, the Data Center Market is thriving due to its strategic location as a gateway to China and the rest of Asia. The city's advanced telecommunications infrastructure and reliable power supply also make it a prime location for data center operations. Additionally, Hong Kong's business-friendly environment and low tax rates attract international companies to establish their data centers in the city. The market is further driven by the increasing demand for cloud services and the government's initiatives to promote Hong Kong as a regional data hub.

Underlying macroeconomic factors: The growth of the Data Center Market in Hong Kong is heavily influenced by macroeconomic factors such as technological advancements, government policies, and investment in digital infrastructure. Hong Kong, being a global financial hub, has a strong economy and favorable regulatory environment that supports the growth of the data center market. Additionally, with the rise in demand for cloud services and the increasing amount of data generated by businesses, there is a growing need for efficient and secure data storage and management solutions. This, coupled with the government's investments in digital infrastructure, is expected to drive the growth of the data center market in Hong Kong.

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.