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Data Center Market in Africa - Industry Outlook and Forecast 2019-2024

SKU : ARZ190811
  • Published on : September 2019

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This market research report on the Africa data center market covers market sizing and forecast, market share, industry trends, growth drivers, and vendor analysis. The market study includes insights on the segmentation by IT Infrastructure (server, storage, and network), Electrical Infrastructure (UPS, generators, rack power distribution units, transfer switches & switchgears, and other), mechanical Infrastructure (cooling systems, racks, and other mechanical infrastructure), cooling Systems (CRAC & CRAH, chiller units, cooling towers & dry coolers, economizer & evaporative coolers, and other cooling units), cooling Technique (air-based cooling technique and liquid-based cooling technique), general Construction (building development, installation & commissioning services, building design, physical security, DCIM), tier standards (Tier I & II, Tier III, and Tier IV), and geography (South Africa, Nigeria, Kenya, and Other African Countries).

Africa Data Center Market: Dynamics

The procurement of renewable energy sources is expected to drive the demand for renewable energy infrastructure in the Africa data center market

The concept of developing smart cities in Africa is likely to increase the demand for on-premise modular data center solutions in Africa. The Transform Africa Summit unveils the Smart Cities' Blueprint, which showcases the commitment of countries such as Rwanda, Nigeria, Ghana, and Ethiopia to develop and build smart cities. Huawei, a Chinese Telecom provider, along with Kenya government, has commenced a smart city initiative in Kenya, which will bring modular data centers in various location across the city. Hence, these initiatives in the African continent are expected to drive the data center infrastructure market.

The increasing procurement of renewable energy sources to power data center operations, especially after the entry of hyperscale service providers is expected to be a significant driver for the Africa data center market. Also, the growth in power consumption and the need for reliable power sources in data centers are driving hyperscale data center service providers to purchase clean and renewable energy sources to power their facilities in Africa.  Therefore, the availability of renewable energy sources in Africa sources is expected to drive hyperscale data centers to adopt renewable energy infrastructure.

The emergence of converged infrastructure and hyperconverged platforms has increased scalability in business operations. The increasing popularity of concepts such as software-defined data centers, virtualization, and cloud computing is a significant driver for the adoption of hyperconverged data centers. Hence, the adoption of converged and hyperconverged infrastructure platforms will witness an increase as they are easy to manage and require minimal expertise. The Africa data center market is expected to grow at a CAGR of over 13% during the period 2018−2024. The research report also offers market share analysis in terms of area(sq.ft), power capacity(MW) during the forecast period.

Africa Data Center Market: Segmentation

This research report includes detailed market segmentation by IT infrastructure, electrical infrastructure, mechanical infrastructure, general construction, tier standards, and geography.



Africa Data Center Market: IT Infrastructure

The high adoption of big data, cloud, and IoT solutions will continue to increase the demand for high-performance computing servers

The Africa data center market by severs is growing at a significant pace due to increased internet penetration. The high adoption of big data, cloud, and IoT solutions will continue to increase the demand for high-performance computing (HPC) servers. Also, government initiatives to establish the digital economy in Africa is likely to act as a strong catalyst for the adoption of IT infrastructure, especially severs. The data center server market in Africa is growing over 20% in 2019. Also, the increasing demand for cloud services in the region is leading to the development of the cloud in Africa, thereby increasing the investment in advanced server systems during the forecast period.

In Africa, the growing data generation will continue to increase the demand for high-performance storage infrastructure solutions. Also, the increase in social media users is generating a large amount of data in the region. Countries such as South Africa, Nigeria, and Kenya are on the path of adopting new and modern technology. Further, the procurement of storage infrastructure in data centers will increase significantly as the deployment of big data and Artifical intelligence applications will demand the need for flash-enabled storage systems.

Innovations are driving the network segment in the Africa data center market. The increase in the data traffic and the decline in the price of 10GE switches are the major drivers for the Africa data center market by network. 8/16 Gbps switch ports are likely to replace 2/4 Gbps ports during the forecast period. 

Africa Data Center Market: Electrical Infrastructure

The increased adoption of performance-optimized data centers will lead to the demand for generators with less than 1 MW capacities

With African data centers facing the power reliability challenge, electricity failures are likely to affect the operations. Hence, the UPS market in Africa is expected to witness growth as these systems are critical for continuous operations, and the prevention of infrastructure failures. The generator market in Africa will continue to grow due to the increased construction of large and mega data centers and the unreliable in the power grid connectivity. Further, the increased deployment of performance-optimized data centers will lead to the demand for generators with less than 1 MW capacity. 

The increased construction of data centers in Africa is expected to increase the demand for transfer switches and switchgears during the forecast period. However, the use of switches will vary significantly based on capacity, cost, mean time between failures (MTBF), switching time, and design. With the increased construction of large data centers, moderate and low voltage switchgears are more likely to be adopted in the Africa data center market. The increasing deployment of modular facilities is expected to increase the demand for low-voltage switchgears as they are low-priced and efficient.

The IT infrastructure in data centers in Africa has been growing significantly in the last decade, leading to the deployment of racks that can support more than 5 kW. Owing to the growing power fluctuation, a minimum of two PDUs is required to be mounted inside a single rack to avoid interruption in operations.

Africa Data Center Market: Mechanical Infrastructure

The market for cooling systems in Africa is likely to include the  infrastructure that takes outside air to cool the facilities

The data centers in Africa support free cooling systems. The market for cooling systems in Africa is likely to depend on the construction of mega and hyperscale facilities, especially 10 MW capacity. The adoption of cooling systems depends on the IT load, system capacities, expenditure, and future requirements. The Africa data center market by racks is expected to grow at a CAGR of 14%. As 42U rack units are most commonly adopted in the Africa data center market, the market share of this segment is expected to double by the end of the forecast period. The other cooling segment consists of pump systems, piping units, and valves. The adoption of these units depends on the type of cooling technique implemented by facilities such as air/liquid cooling. Large data centers are the major revenue contributors to this segment as they use the liquid-based cooling technique.

Africa Data Center Market: Cooling Systems

The scarcity of water is expected to prompt large operators to invest in on-site water treatment plants

While several small facilities in Africa use DX-based CRAC units that operate at a low rack power density of around 3 kW, medium and large data centers install CRAH units.  With data centers now being built to handle more than 5 MW of IT load, the use of multiple CRAC & CRAH units in data halls is growing. Also, the adoption of air-cooled CRAC systems installed in line with cooling units in the data center that uses refrigerant or glycol-based cooling is expected to grow during the forecast period.

The market for chillers and cooling towers and dry coolers is growing significantly as data center operators in Africa are adopting modern cooling designs to decrease power consumption. 

 The other cooling units segment comprises humidifiers, airflow management products, additional monitoring units, and on-site water-treatment plants. The adoption of other cooling units depends on the design of data center facilities. The scarcity of water will prompt large operators to invest in on-site water treatment plants.

 Africa Data Center Market: General Construction

Increase in the construction of data centers in Africa will increase the demand for skilled workforce in construction and facility operations

The Africa data center market is currently witnessing an increase in the construction of greenfield projects. The development of mega facilities in Africa will drive the market for sustainable building development. Also, the growing investment in submarine cable projects will increase the need to establish point-of-presence facilities that are modular.

The growing construction of data center projects is expected to increase the demand for skilled professionals in the region. The growth in greenfield facilities is likely to generate more revenue for installation and commission service providers. The market for building designs is expected to increase as there is a growing demand for the facilities that offer reliability, scalability, and flexibility in operations along with efficiency.  The need to operate sustainable operations is likely to augur well for the Africa data center market.

Innovations in DCIM software are growing with the integration of predictive and prospective analysis. The use of DCIM software has resulted in a significant reduction in power consumption and decreased carbon emissions, thereby reducing the OPEX of data centers. DCIM solutions are expected to gain significant traction in the Africa data center market during the forecast period.

Africa Data Center Market: Tier Standards

The importance of uptime institute certified data centers are growing in the African data center market

The increased awareness of the use of redundant infrastructure has significantly led to the decline of Tier I data centers in the past five years. While Tier II data centers in Africa have minimum redundancy, particularly in UPS and PDU systems, the colocation cost is low. Several under-developed projects data centers in Africa largely fall in the tier III category. This trend is expected to continue during the forecast period. Stringent environment regulations and the need to follow sustainable business practices are driving new data centers to be designed as per Tier III standards with a minimum of N+1 redundancy. The growth in the rack power density and critical data center applications is expected to shift many service operators to the Tier IV category during the forecast period. The incorporation of flexible designs is expected to configure up to 2N+1 redundancy in the tier IV data center in Africa.

 Africa Data Center Market: Geography

 The increasing penetration of smartphones and the internet is expected to increase the investment in South Africa during the forecast period

 South Africa is witnessing major development in Africa. Cities such as Cape Town and Johannesburg are the most preferred locations for data center construction. The South Africa data center market is expected to witness major investments during the forecast period due to the increasing number of smartphone users and strong internet penetration. Also, the market is seeing increased adoption of cloud-based solutions among enterprises. South Africa is rapidly emerging as a center for public and private cloud hosting, which is expected to improve data center development.

 The market in Nigeria is growing at a significant pace due to the increasing adoption of digital services by government, commercial, and public agencies. Increased government support for cloud adoption is likely to increase in the coming years, leading to the increased data center investment in the country.

With the highest internet penetration, Kenya is emerging as a critical destination for investment. The growing adoption of digital services such as cloud, big data, and IoT is leading the data center development in Kenya. Another initiative in the country includes the partnership between Microsoft and Strathmore University School of Law to initiate discussion aimed at digitizing East Africa’s justice, healthcare, and agriculture systems. These initiatives are likely to increase data center investments in the country.

Key Countries Profiled:

  • South Africa
  • Nigeria
  • Kenya
  • Other African Countries

Key Vendor Analysis

The Africa data center market is in the nascent stage, and it has strong growth potential as many enterprises are migrating from server rooms to cloud or colocation platforms. Cisco, Dell Technologies, HPE, Huawei, Lenovo, and IBM are the leading players in the market. The competition is mostly based on pricing as several enterprises are procuring IT infrastructure under stringent budget constraints. The adoption of converged and hyperconverged infrastructure solutions is likely to increase during the forecast period.

The popularity of big data, IoT, and artificial intelligence is likely to increase the adoption of application workload-specific server infrastructure. This infrastructure is expected to be medium to high-performance category. The establishment of the cloud region will add revenue toward the white-box server infrastructure. In terms of revenue, branded infrastructure vendors will dominate the African data center market for the next few years than OEMs.

Prominent Data Center Critical (IT) Infrastructure Providers

  • Arista
  • Atos
  • Broadcom
  • Cisco
  • Dell Technologies
  • Hewlett Packard Enterprise (HPE)
  • Huawei
  • IBM
  • Lenovo
  • NetApps

Prominent Data Center Support Infrastructure Providers

  • ABB
  • Caterpillar
  • Cummins
  • Eaton
  • HITEC Power Protection
  • Legrand Group
  • MTU Onsite Energy (ROLLS-ROYCE Power Systems AG)
  • Rittal
  • Schneider Electric
  • Stulz
  • Vertiv

Prominent Data Center Contractors

  • Aveng Grinaker
  • Atkins
  • Concor
  • Edarat Group
  • Future-Tech
  • Harinsa Qatar
  • Huawei

Prominent Data Center Investors

  • Africa Data Centers
  • Internet Solutions
  • MainOne
  • Teraco Data Environments

Key Market Insights Include

The report provides the following insights into the Africadata center market for the forecast period 2019–2024.

  1. It offers comprehensive insights into current industry trends, trend forecast, and growth drivers about the Africadata center market.
  2. The report provides the latest analysis of Africa data center market share, growth drivers, challenges, and investment opportunities.
  3. It offers a complete overview of market segments and the regional outlook of the Africa data center market.
  4. The report offers a detailed overview of the vendor landscape, competitive analysis, and key market strategies to gain competitive advantage.


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