Data Center - Kenya

Kenya

Revenue in the Data Center market is projected to reach US$589.20m in 2024.
Network Infrastructure dominates the market with a projected market volume of US$245.10m in 2024.
Revenue is expected to show an annual growth rate (CAGR 2024-2029) of 6.93%, resulting in a market volume of US$823.70m 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 Kenya is experiencing modest growth, driven by factors such as increasing demand for digital storage and network infrastructure, as well as the growing awareness of the importance of data security and accessibility. Despite the minimal growth rate, the market is being impacted by the high costs associated with server and storage technologies, as well as limited investment in network infrastructure.

Customer preferences: With the growing importance of data-driven decision making, businesses in Kenya are increasingly investing in advanced analytics and artificial intelligence (AI) solutions. This trend is driven by the need for real-time insights and predictive capabilities to stay competitive in the rapidly evolving market. Furthermore, the rise of e-commerce and digital payment options has driven the demand for secure and reliable data centers to support these transactions. This has led to a parallel growth in the demand for cloud-based data storage and management services.

Trends in the market: In Kenya, the data center market is experiencing a surge in demand for cloud-based services, driven by the increasing adoption of digital technologies and the government's push for digital transformation. This trend has led to the construction of new data centers and the expansion of existing ones, providing opportunities for data center service providers and IT companies. Additionally, there is a growing trend of data center outsourcing, as companies look to reduce costs and improve efficiency. This trajectory is significant as it reflects the country's efforts to harness the potential of technology and digitalization. However, industry stakeholders must also address challenges such as limited internet connectivity and energy supply to sustain this growth.

Local special circumstances: In Kenya, the Data Center Market is experiencing growth due to the country's strategic location, favorable business environment, and emerging technology industry. Additionally, Kenya's push for digital transformation and investment in advanced technologies, such as cloud computing and data analytics, has driven the demand for data center services. Furthermore, the government's focus on improving internet infrastructure and regulations promoting data privacy and security have also significantly impacted the market's dynamics, making it a favorable environment for data center investments.

Underlying macroeconomic factors: The Data Center Market in Kenya is heavily influenced by macroeconomic factors such as technological advancements, government support, and investment in digital infrastructure. Countries with strong government policies and significant investment in data center technologies are experiencing faster market growth compared to regions with regulatory challenges and limited funding. Furthermore, the increasing adoption of cloud services and the rapid growth of e-commerce and digital activities in Kenya are driving the demand for data center solutions to improve efficiency and meet growing data storage needs. As the Kenyan economy continues to grow, the demand for data center services is expected to increase, making it a highly attractive market for data center providers.

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.