This market research report on global data center colocation market offers analysis on market size & forecast by:
The report covers details on market share, industry trends, growth drivers, and vendor analysis. The market study also includes insights on segmentation by investment, by service type, and by geography.
The increasing adoption of cloud-based services and the use of social media platforms has led to the construction of new hyperscale facilities by several colocation providers, thereby, propelling the growth of the global data center colocation market. The leading colocation providers are building hyperscale facilities spanning over 200,000 square feet with rack power density of up to 50 kW to meet dynamic consumer demands in the market. The colocation data center market is led by the US, followed by Western Europe, China & Hong Kong, Southeast Asia, Australia, and New Zealand in terms of investment and service revenue. The increasing number of submarine cable projects in developing nations will lead to increased investment from data center Real Estate Investment Trusts(REITs)in the market over the next few years. The increasing focus on enhancing the operational efficiency of facilities, reducing power consumption, and decreasing carbon emissions will boost the revenues in the global data center colocation market. The procurement of renewable energy sources and the development of innovative cooling systems will contribute to the evolution of the global market. The installation of modular infrastructure is among the top priorities for colocation server hosting companies in the global market. The investments in wholesale colocation facilities with the construction of multiple data halls and power capacity of over 1 MW will grow significantly compared to retail colocation spaces in the market during the forecast period. In terms of colocation service, vendors will continue to build both retail and wholesale colocation spaces, increasing occupancy to over 90% leading to the growth of global data center colocation market.
The service providers are building facilities that support a rack power density of 20 kW because of the increased use of high-performance computing infrastructure in the global data center colocation market. The deployment of edge datacenters with modular facilities, integrated power, and the cooling component will create lucrative opportunities for vendors in the market. The global data center colocation market is anticipated to witness investment of around $31 billion by 2023, growing at an impressive CAGR of approximately 8% during 2017-2023. The research report offers market size analysis regarding colocation services during the forecast period.
The advent of data regulations will increase datacenter investments from colocation providers in the global data center colocation market over the next few years. The exponential growth of businesses has led to strong regulations about privacy and security of data processed by operators and consumers in the global market. Several countries are framing regulations for the storage and processing of the consumer data. In April 2016, the European Union adopted the General Data Protection Regulation (GDPR), which came into effect from May 2018 and this regulation restricts facility operators to store personal data outside the European Union.
Furthermore, the implementation of stringent compliance and data regulations in the healthcare and financial services sector will propel the evolution of the global data center colocation market. Many customers are verifying with colocation providers regarding PCI compliances to ensure the safety of data hosted in the facilities in the market. The implementation of regulatory compliance by various government agencies worldwide will propel the need for strict data security in the global data center colocation market.
This market research report includes a detailed segmentation of the market by investment, service type, and geography.
Data Center Colocation Market – By Investment
The global data center colocation market will witness increased investment on mega facilities from established players and also new entrants
The data center colocation market by investment is segmented into electrical infrastructure, mechanical infrastructure, and general construction. Electrical infrastructure segment dominated majority of the market share in 2017, growing at a CAGR of around 8% during the forecast period. The report offers market size analysis in terms of power capacity (MW) and square feet area for all the segments for 2017-2023. The development of 2N UPS systems, generators, and rack PDUs will augment the growth of this segment in the global market. The incorporation of modular infrastructure will result in more OPEX cost saving, efficient, require less maintenance, and reduce space across facilities in the global market. The adoption of intelligent real-time monitoring software that can predict maintenance requirements, component failures, and automatic switchovers for uninterrupted operations will contribute to the revenues in the global data center colocation market. The increasing adoption of water-based cooling techniques that comprise chillers and cooling towers will augment the growth of the mechanical infrastructure segment. The adoption of DCIM systems that offer real-time solutions will drive the global market.
Data Center Colocation Market – By Service Type
The demand from large enterprises for wholesale colocation and hybrid infrastructure services for retail colocation will drive the demand for spaces in the global data center colocation market
The service type segment in the global data center colocation market is classified into retail and wholesale. Retail colocation segment occupied around 2/3rd of the market share in 2017, growing at a CAGR of more than 8% during the forecast period. The sustainability of these services for facility providers that require small computing service at a single site or across multiple geographical locations for global and local customers will drive the growth of this segment. The cost of retail colocation varies from $700 to $2,500 depending on the service provider or adopted services. The consumers are adopting caged rack spaces comprising multiple racks that offer strong connectivity with multiple facilities and cloud platforms. These services are designed to offer more control to enterprises over IT infrastructure operations than managed hosting services. The lack of fundamental prerequisites such as high-speed fiber connectivity, disaster recovery locations, and a shortage of a skilled workforce to operate in-house pre-fabricated facilities is propelling the growth of this segment in the global data center colocation market.
Data Center Colocation Market – By Geography
The US is leading the global data center colocation market, where the majority of REIT will focus on investing in EMEA and APAC region during the forecast period
The global data center colocation market by geography is categorized into the Americas, EMEA, and APAC. The Americas dominated close to half of the market share in 2017, growing at a CAGR of around 3% during the forecast period. The report offers market size analysis by investment, square feet area, power (MW), and services. The development of new facilities for Tier III and Tier IV standards across the US and Canada is propelling the growth of this region in the global market. The adoption of 2N redundancy configuration in UPS systems and PDUs, and generators and cooling systems of N+1 or N+N configurations across the Americas. The colocation service providers are the major investors in datacenter developments across the region with multiple mega facilities consuming power capacity of over 20 MW. The major markets for colocation data center construction activities across the US are Virginia, Texas, California, New York, North Carolina, and Illinois. The demand for cloud-based services, IoT, big data, GDPR and availability of renewable energy sources are the major factors attributing to the growth of the European region. The multiple M&A activities namely ST Telemedia’s acquisition of Tata Communication data centers in India and GDS Holdings in China will continue to grow aiding in continuous investment and revenue contribution to the data center colocation market APAC.
Key Countries Profiled
Key Vendor Analysis
The global data center colocation market is witnessing increasing investments due to multiple expansion and newly-built projects across the globe. The telecommunication providers across developing regions Latin America, Eastern Europe, Middle East, and Africa, and Southeast Asia is investing on the development of new facilities. Colocation providers involved in continuous investments in new facilities are experiencing revenue growth of over 10% YOY. Leading provider entering new markets through acquisition and construction of new facilities have to compete against local providers. Partnership to build and operate data center will continue to grow in the market. New entrants might pose a threat to existing players. Service providers are also involved in colocating wholesale spaces to provide retail colocation and managed services in the global market. Interconnection, cloud connectivity and managed services solutions will play a major factor in attracting new customers in the global data center colocation market.
The major vendors in the global data center colocation market are:
The other prominent players in the global data center colocation market are 21Vianet (Century Internet Data Center), 3data, Ascenty, Axtel, Atman, Bell Canada, China Mobile, China Unicom, Chunghwa Telecom, Colo-D, Colt Data Centre Services (Colt DCS), CoreSite Realty, Cyxtera Technologies, Datacom, T-Systems (Deutsche Telekom), Digiplex, Flexential (Peak 10 & ViaWest), GDS Holding Limited, Global Switch, Hydro66, Iliad Data Center, IXcellerate, Keppel DC, CenturyLINK (Level 3), Liquid Telecommunication, Mobily, NEXTDC, OneAsia Network, Ooredoo, PCCW Solutions, Philippine Long Distance Telephone (PLDT), Quality Technology Services (QTS), Singtel, Sinnet, ST TelemediaGlobal Data Centres(STT GDC), SUNeVision (iAdvantage), Telefónica, Telehouse, PT Telkom Group (Telin), PT Telkom Group (Telin), Teraco Data Environments, Urbacon Data Center Solutions, VADS Berhad, Vantage Data Center, and Zayo Group.
Key market insights include
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