This market research report on the EMEA data center colocation market provides market size and forecast, share, industry trends, growth drivers, and vendor analysis. The market study includes insights on the segmentation by electrical infrastructure (uninterruptible power supply (UPS) systems, generators, rack power distribution units (PDU), transfer switches & switchgear, and other electrical infrastructure), mechanical infrastructure (cooling systems, racks, and other mechanical infrastructure), general construction (building development, installation & commissioning services, building design, physical security, and data center infrastructure management (DCIM)), colocation service type (retail and whole), and geography (Western Europe, Central and Eastern Europe, Nordic countries, and MEA ).
Around 28% of organizations in the Middle East are using cloud-based customer engagement application; 18% are implementing cloud applications
The Europe colocation market has witnessed a significant boost in investments due to the implementation of the GDPR in May 2018. The Middle East and Africa market is also witnessing growth on account of the increased adoption of cloud-based services and the improvement in fiber connectivity across the region. Around 28% of organizations in the Middle East are using cloud-based customer engagement applications; 18% are implementing cloud applications, while 15% are planning to implement cloud-based applications to improve business productivity. Hence, the adoption of cloud center services in MEA regions is likely to increase the demand for hyperscale facilities in these regions through wholesale colocation take-up in the region.
Technological advancements are driving the EMEA data center colocation market. The development of additional facilities that can process exabytes of data generated by both business and consumer users are growing. The colocation market in Western Europe has been witnessing significant investments since 2017, with multiple projects carried out by colocation service providers. The market saw an increase in M&A activities, which is aided by continuous investments in new facilities by Equinix, ST Telemedia, and CyrusOne.
The EMEA data center colocation market is expected to grow at a CAGR of over 5% during the period 2018–2024.
This research report includes detailed segmentation by electrical infrastructure, mechanical infrastructure, general construction, colocation services, and geography.
EMEA Data Center Colocation Market: Electrical Infrastructure
With increased construction of data centers, the market for transfer switches and switchgears is expected to grow during the forecast period
Power outages and fluctuations due to grid instability make UPS systems critical components of data center operations. Although many facilities do not suffer from power outages, power fluctuations increase the importance of UPS systems for continuous operations. Continuous innovations in these backup systems, such as lithium-ion batteries, have increased their applicability in the energy-consuming industry, such as data centers.
Generators ensure 100% availability of data center services. The use of generators in EMEA is crucial as power outages are frequent in certain countries, especially in the MEA region. The generators market will continue to grow because of the continuous construction of large and mega facilities in EMEA. However, the adoption of generators will be high in the MEA region, with maximum demand coming from the Africa region as the power outages are frequent.
The installation of transfer switches is carried out at the rack level, and they highly depend on the efficient design of the facilities. The growing complexity of data center infrastructure is driving the growth of automated switchgear technology. With the increased construction of facilities, the market for transfer switches and switchgears is expected to grow 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.
EMEA Data Center Colocation Market: Mechanical Infrastructure
Constant innovations in rack designs provide increased airflow perforation and enhanced cabling channel capacities
The use of indirect evaporative coolers and air/water-side economizers will continue to grow in Nordic and Northern Western Europe countries. A few facilities use chillers that enable cooling of the facility using the outside air and water-based cooling during summers. They also include water-side economizer systems. Hence, the need to reduce CAPEX and OPEX, conserve data center space, and reduce power supply to cooling units, the coolers segment is expected to grow during the forecast period.
Innovations in rack units are driving the rack market. 42U rack units are the commonly used one in EMEA data centers. However, the market has witnessed an increased demand for 45U, 47U, and 48U racks installed in large capacities recently. Vendors are also continually introducing rack with innovative designs that provide 80% airflow perforation, with enhanced cabling channels, and more support for weight capacity.
EMEA Data Center Colocation Market: General Construction
The need the offer highly reliable data center services is increasing the focus on installation and commissioning services
The high demand for hyperscale services is driving the market share of the building development segment. Colocation service providers such as AWS, Google, Facebook, Apple, and Microsoft employ professionals to work alongside construction contractors and design and architectural firms to build data centers. Hyperscale investments in some European countries such as Denmark, Ireland, and Germany are expected to develop high demand for skilled professionals. Also, these facilities employ engineers for design and installation and commissioning services.
Installation and commissioning services are the key processes in data center development. These services are growing in the EMEA region due to the rise in the construction of facilities and an increase in sub-contracting activities. Moreover, the need for the proper functioning of electrical equipment is driving the demand for installation and commissioning services.
The DCIM segment is expected to grow at the highest CAGR during the forecast period. The increasing construction of facilities has increased power consumption and carbon emissions. Therefore, the monitoring of each IT infrastructure component, especially in medium- and large-sized facilities, becomes cumbersome. Hence, the installation of DCIMs, which are integrated into the data center infrastructure for monitoring and managing the facility, is expected to grow. Besides, power surges are also leading to infrastructure failures and equipment damage. To identify power consumption in the facilities, infrastructure vendors, and pure-play DCIM providers are offering solutions that integrate infrastructure monitoring into a single software.
EMEA Data Center Colocation Market: Service Type
The implementation of GDPR in Europe has increased wholesale colocation serviced demand
Retail colocation services are likely to grow among several African and Eastern Europen countries. Companies are shifting from on-premise to colocation services to improve reliability and scalability in their services. The increased demand for business-specific IT infrastructure with 100% uptime and scalability is driving organizations to shift from on-premise to colocation services. As these retail services provide more control to enterprises over IT infrastructure operations than managed hosting services, these services enjoy high popularity among enterprises. The adoption of wholesale colocation services is growing, especially in the European market, due to the implementation of the GDPR and the increased demand for high computing capacities.
EMEA Data Center Colocation Market: Geography
The Middle East & Africa data center market is growing significantly with investments from telecommunication and pure-play local 0colocation and managed hosting service providers
The colocation market in Western Europe witnessed significant investments in 2018. Colocation providers and internet and cloud service providers are the major contributors to the data center market in Nordic. Several cloud service providers depend on colocation providers to procure services on a wholesale basis. The colocation market in Eastern Europe is smaller than Western Europe and the Nordic region. In Eastern Europe, a majority of facilities identified with an investment of more than $10 million with few facilities with investment more than $35 million. The data center development is mainly concentrated in the Czech Republic, Austria, Poland, and Russia in Eastern Europe. The increasing internet penetration in Austria, the Czech Republic, Latvia, Poland, is witnessing an increase in demand for internet-based services. Enterprises prefer to opt for colocation services than managing on-premise infrastructure. The market in MEA is growing significantly with investments from telecommunication and pure-play colocation and managed hosting service providers. Submarine cable projects such as Africa-1 connecting South Africa, the Middle East, Pakistan, and Europe, which is expected to be operational till 2021, is likely to boost the market.
Key Countries Profiled:
Key Vendor Analysis
Equinix led the market with an estimated net rentable area of around 575,000 square feet through 16 facilities that had opened and under construction in 2018. Equinix has also invested in facilities across Western Europe, Nordic, and Central and Eastern Europe. Western Europe accounted for 94% of the total investment made in EMEA by Equinix. Equinix invested in locations such as London, Amsterdam, Frankfurt, and Paris. The company is also expanding its colocation space by acquiring multiple facilities. For instance, Equinix completed the acquisition of Switch Datacenter AMS1 to expand its operations in Amsterdam, Netherlands. The company expands or constructs new facilities due to the growing demand for cloud-based services. Moreover, the market in Western Europe and Nordic is likely to witness more construction of wholesale data center space than retail during the forecast period. The Western Europe market has witnessed multiple mergers and acquisitions in the past decade. CyrusOne acquisitions of Zenium Data Centers in 2018, has helped CyrusOne to establish a strong base in Germany, meanwhile expanding in the UK and the Netherlands markets. The report covers the vendor share analysis in the following way:
Key Company Profiles
Other Prominent Vendors – 3data, Aruba, Atman Data Center (ATM S.A), Basefarm, Batelco, Bezeq International, Colt Data Center Services (Colt DCS), Centurylink (Level 3 Communication), Cyxtera Technologies, DCstar, Digiplex, Euclyde, Flexential ( Peak 10 & VIAWest), Fortlax, Global Connect, Green Datacenter, Hydro66, Scaleway Data Center, Internap, Interoute (GTT Communications), IXcellerate, Keppel DC, LDeX Group, Liquid Telecommunication, LuxConnect, Mobily, Ooredoo, ST Telemedia Global Data Centres (STT GDC), Switch, Telehouse, Telefonica, Teraco Data Environments, Tieto, T-Systems (Deutsche Telekom), Turkcell, Verne Global, VNET, and Zayo Group Holdings
Key Market Insights Include
The report provides the following insights into the EMEA data center colocation market for the forecast period 2019–2024.
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