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Data Center Market Size, Share, & Trends Analysis Report by IT Infrastructure (servers, storage, and network), Electrical Infrastructure (UPS systems, generators, rack power distribution units (PDU), transfer switches & switchgears, and others), Mechanical Infrastructure (cooling systems, racks, and other mechanical infrastructure), Cooling Systems (CRAC & CRAH units, chiller units, cooling towers, dry coolers & condensers, and other cooling units), Cooling Techniques (air-based and liquid-based), Liquid Cooling Techniques (direct-to-chip, liquid immersion, and water-based), General Construction (building development, installation and commissioning services, building designs, physical security, data center infrastructure management (DCIM) & building management systems (BMS)), Tier Standards (Tier I and II, Tier III, and Tier IV), and Geography (North America, Latin America, Western Europe, Nordic Region, Central & Eastern Europe, Middle East, Africa, APAC, Southeast Asia), Industry Analysis Report, Regional Outlook, Growth Potential, Price Trends, Competitive Market Share & Forecast, 2020–2025.
|Market Size (INVESTMENT)||USD 190 Billion (2025)|
|Market Size (AREA)||39 MILLION SQ.FT. (2025)|
|Compound Annual Growth Rate (CAGR)||2% (2020-20225)|
|Market Segments||IT Infrastructure (servers, storage, and network), Electrical Infrastructure (UPS systems, generators, rack power distribution units (PDU), transfer switches & switchgears, and others), Mechanical Infrastructure (cooling systems, racks, and other mechanical infrastructure), Cooling Systems (CRAC & CRAH units, chiller units, cooling towers, dry coolers & condensers, and other cooling units), Cooling Techniques (air-based and liquid-based), Liquid Cooling Techniques (direct-to-chip, liquid immersion, and water-based), General Construction (building development, installation and commissioning services, building designs, physical security, data center infrastructure management (DCIM) & building management systems (BMS)), Tier Standards (Tier I and II, Tier III, and Tier IV)|
|Geographic Analysis||North America, Latin America, Western Europe, Nordic Region, Central & Eastern Europe, Middle East, Africa, APAC, Southeast Asia|
|Countries Covered||US, Canada, Brazil, UK, Germany, France, Netherlands, Ireland, Denmark, Iceland, Finland, Norway, Sweden, Russia & Czech Republic, Poland & Austria, GCC, South Africa, Morocco, China & Hong Kong, Australia & New Zealand, India, Japan, Singapore, Malaysia, Thailand, Indonesia, Other Middle Eastern Countries, Other Central and Eastern Countries, Other African Countries, Rest of APAC, and Other Southeastern Countries|
The global data center market size will reach USD 198 billion in 2025, growing at a CAGR of 2% during 2020-2025. The market is witnessing significant investments from colocation service providers, cloud/hyperscale service providers, and telecommunication service providers. Hyperscale data center investment has grown significantly in the past years, led by Google, Facebook, AWS, Alibaba, and Microsoft. The market witnessed investment in over 100 facilities with a power capacity of over 15 MW. Telecommunication providers in several countries are investing heavily to grow broadband connectivity worldwide. Moreover, government agencies are fueling the growth of the digital economy in several countries. The initiatives toward the development of smart cities will continue to boost the need for edge computing during the forecast period.
The demand for colocation and managed service is growing in the global market due to technological advancements across industries. The market witnessed investment in over 300 colocation projects. This includes investments in new facilities as well as expansion projects. Many enterprises in developed countries are migrating to colocation data centers to operate hybrid infrastructure services. In the US region, colocation service providers are making substantial contributions to hyperscale data center projects. Several colocation service providers are investing more than $200 million in new construction and expansions in the data center colocation market worldwide. Colocation service providers are investing in major hyperscale projects in developing countries. China, Australia, Hong Kong, and India are expected to be the major destination for colocation investment in APAC during the forecast period.
This research report includes detailed segmentation by
In 2019, the storage systems market was driven by the increased adoption of all-flash storage arrays and hybrid storage arrays. The growth of flash storage systems is aided by high-performance operations that require strong I/O capabilities. All-flash storage systems are supporting the increasing deployment of applications related to big data and AI technology. Several innovations have surrounded in the network space in the last several decades. 25GbE and 100GbE switches witnessed strong growth in 2019. The increase in the data traffic is increasing the complexity both in the internet and the internal data center network.
The adoption of lithium-ion batteries is likely to increase during the forecast period as their price will continue to decline significantly. It is expected that the contribution from colocation providers will be high in terms of lithium-ion UPS solutions. Generators will continue to grow because of the continuous construction of large and mega facilities across the globe. Many data centers in North America and Europe, where the requirement for generators with higher redundancy is less, are being established and powered by renewable energy sources.
The adoption of Diesel Rotary Uninterruptible Power Supply (DRUPS) systems will continue to witness growth among developing countries. Regions such as Latin America and Southeast Asia are the major revenue generators for DRUPS systems. With the increased data center construction across the globe, the market size for transfer switches and switchgears is expected to grow during the forecast period.
Data centers in Southeast Asia, China, India, Australia, the Middle East, and Africa are likely to prefer chilled water systems or a combination of both air and water-based cooling techniques. Free cooling chillers that facilitate partial cooling using outside air are highly preferred. Most modern facilities are being built based on the ASHRAE data center cooling guidelines and the Uptime Institute’s tier standards for redundant design. The increased use of rack scale converged infrastructure systems that support AI and ML workloads in data centers will have an impact on the rack power density. The OCP rack architecture will witness strong growth along with rack units of over 45U.
With data centers now being built to handle more than 10 MW of IT load, the use of multiple CRAC and CRAH units split across data halls, and containment designs are growing. The market will continue to grow that use DX or chilled-water cooling solutions. Data centers are likely to adopt 2N CRAC or CRAH units, whereas other facilities are expected to go for N+N systems. Several facilities are being developed in the regions such as North America, Western Europe, Eastern Europe, and Nordic, to benefit from free cooling techniques; hence, the adoption of indirect evaporative cooling systems is likely to grow over the next few years.
The data center operators in the US, Europe, Nordic, China, Australia, New Zealand, Canada, and Japan are mainly using free cooling solutions. The market is witnessing the increased adoption of evaporative coolers that facilitate partial cooling with indoor CRAC units being used among data centers. Innovations in the free cooling space, especially with the use of outside air for cooling without any on-site water requirement, will continue to grow the market during the forecast period.
The global data center market has a strong presence of general contractors. The competition among general contractors will increase during the forecast period. Expertise in developing facilities in a short period will be key criteria for service operators in the selection of general contractors. Many operators have a strong partnership with general contractors. However, the major challenge for several contractors in the region is the unavailability of a skilled workforce to manage multiple hyperscale projects. The importance of physical security will increase in the market, where DCIM adoption will include support from artificial intelligence and machine learning in the market.
Developing regions/countries such as Latin America, Indonesia, Thailand, and India are experiencing strong growth in greenfield construction. This will bring significant revenue opportunities for contractors and subcontractors operating in the market.
With the increasing focus on building highly efficient and reliable data centers, the investment in Tier IV facilities will grow across the globe. Most new facilities are designed as Tier III standards with minimum N+1 redundancy and can be reconfigured with up to 2N redundancy as the demand arises. A majority of under-developed projects across the globe fall under the Tier III category. This trend is likely to continue during the forecast period, with many operators expected to move to the Tier IV category based on the growth in rack power density and critical applications.
Many colocation providers such as Equinix, Root Data Centers (Compass Data Centers), Cologix, QTS, Vantage Data Centers, and Flexential have invested in facilities with a rentable area of over 100,000 square feet across North America. Major contributors to the hyperscale facility development are Facebook and Google in the US. The market investment from Facebook, Google, Microsoft, and Apple will continue to grow during the forecast period.
For instance, Facebook is investing in Ohio, New Mexico, Nebraska, Texas, Oregon, and Virginia in the US. Industry verticals such as e-commerce, real estate, government, finance, insurance, and government sectors are the major contributors to the growth of the data center market in North America. The South Eastern US dominates the market. The Western US and South Western US witnessed strong growth in the investment in 2019. In 2019, Canada witnessed two major acquisition deals, which include Compass Data Center’s acquisition of Root Data Center and Cologix’s acquisition of Colo-D. These acquisitions are likely to boost the Canadian data center market.
The data center market in Western Europe is witnessing investment from both global and colocation service providers. The GDPR has driven the demand for data center development among colocation and cloud services providers. The demand for smart devices, coupled with growing internet penetration, will also fuel the data center market growth. The data center market in APAC is witnessing steady growth with continued investments from hyperscale and cloud service providers.
In developing countries, partnerships with local service providers and resellers, along with modular solution providers, will enhance revenues for vendors. Globally, a single mega data center project contract would contribute significantly to the revenue of infrastructure providers under their respective operating segments. Innovations in power infrastructure are driving the competition among vendors. For instance, vendors such as Schneider Electric, Rittal, HPE, Delta Power Solutions, and Huawei provide infrastructure based on the OCP design. In terms of cooling, the competition between liquid-immersion and direct-to-chip cooling manufacturers will intensify owing to the increased deployment of artificial intelligence and machine learning workloads.
By IT Infrastructure
By Electrical Infrastructure
By Mechanical Infrastructure
By Cooling Technique
By Liquid Cooling Technique
By General Infrastructure
By Tier Standards
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