Israel Data Center Market - Investment Analysis & Growth Opportunities 2024-2029

MARKET OUTLOOK

The Israel data center market will witness investments of USD 896 million by 2029, growing at a CAGR of 5.77% during the forecast period. Prominent cloud services providers like Google, Microsoft, Oracle, and Amazon Web Services, along with local hyperscale cloud providers such as Compass Datacenters and Bynet Data Communications, have established themselves in Israel. Google and Oracle have plans to create new cloud regions in Israel in 2023 and 2024.

The Israel data center market is booming because of strong government support, cloud computing, 5G, smart city initiatives, underground data centers IoT, and digital innovation in various sectors. Furthermore, major hyperscale and colocation operators are focused on building underground data centers in Israel engineered to endure malfunctions and warfare situations for unrivaled security and dependability. In 2023, EdgeConneX built a new underground facility in Rishon LeTsiyon in the region.

In Israel, diverse sectors like agriculture, smart cities, manufacturing, defense, and healthcare are adopting IoT innovations. For instance, Modi'in city enhances its Smart City initiative with IoT integration, improving citizen lives by outfitting 1000 lighting poles with advanced smart controllers, such as Megason's inteliLIGHT, leveraging NB-IoT and GSM connections. Also, the region currently has one FTZ named “The Port City of Eilat,” which serves as an important Free Trade Zone, offering a perfect location for international commerce and trade. In 2022, Dubai's renowned Free Zone, DMCC, expanded its reach into Tel Aviv by inaugurating a representative office in Ramat Gan, Israel, fostering trade ties between the two nations.

KEY HIGHLIGHTS

• Tel Aviv, Petah Tikva, Haifa, and other cities have emerged as top destinations for investments in the Israel data center market, powered by an expanding pool of STEM graduates and more foreign investment, resulting in higher data center deployments and job possibilities.
• Inland connection in Israel is improving, thanks to the establishment of significant internet exchange points such as the Israeli Internet Exchange (IIX) in Tel Aviv, Israel. Major telecom companies such as Cellcom, Pelephone, HOT Mobile, and Partner have commercially introduced 5G in Israel, aiding data center developments.
• The Israel data center market witnessed the entry of new data center operators in 2023, such as Digital Realty, NED Data Centers, ANAN, Serverfarm, and Techtonic.
• Israel's rapid integration of Industry 4.0 tools, including IoT devices, big data, and cloud-based services such as the Nimbus project, alongside growing digitalization, is driving a surge in data generation, fueling the demand for colocation services nationwide.
• Data center operators are more focused on adopting renewable energy sources in the country. For instance, in 2023, Amazon Web Services(AWS) is constructing a data center in the region completely powered by smart grid technology, with a strong capacity of around 48 MW.

WHY SHOULD YOU BUY THIS RESEARCH?

• Market size is available in terms of investment, area, power capacity, and Israel colocation market revenue.
• An assessment of the data center investment in Israel by colocation, hyperscale, and enterprise operators.
• Investments in the area (square feet) and power capacity (MW) across cities in the country.
• A detailed study of the existing Israel data center market landscape, an in-depth market analysis, and insightful predictions about industry size during the forecast period.
• Snapshot of existing and upcoming third-party data center facilities in Israel
  • Facilities Covered (Existing): 23
  • Facilities Identified (Upcoming): 16
  • Coverage: 5+ Cities
  • Existing vs. Upcoming (Area)
  • Existing vs. Upcoming (IT Load Capacity)
• Data Center Colocation Market in Israel
  • Market Revenue & Forecast (2023-2029)
  • Retail & Wholesale Colocation Pricing
• The Israel data center market investments are classified into IT, power, cooling, and general construction services with sizing and forecast.
• A comprehensive analysis of the latest trends, growth rate, potential opportunities, growth restraints, and prospects for the industry.
• Business overview and product offerings of prominent IT infrastructure providers, construction contractors, support infrastructure providers, and investors operating in the market.
• A transparent research methodology and the analysis of the demand and supply aspects of the market.

VENDOR LANDSCAPE

• In the Israel data center market, providers include Digital Realty, Bezeq International, Compass Datacenters, EdgeConneX, MedOne, Global Technical Realty, NED Data Centers, Serverfarm, and Techtonic.
• The Israel data center market witnessed the highest investments from EdgeConneX and Global Technical Realty in data center facilities. The Israel data center market also witnessed investments from other prominent investors such as Adgar Investments & Development, MedOne, and Serverfarm.
• The Israel data center market has a presence of global cloud service providers such as Oracle, Microsoft, Amazon Web Services, and Google.
• New entrants are investing in Israel's underground data centers, acquiring significant growth areas. For example, Techtonic built an underground data center in Beit Shemesh, Israel, with around 15,000 square meters, scheduled for completion in Q2 2025.

EXISTING VS. UPCOMING DATA CENTERS

• Existing Facilities in the Region (Area and Power Capacity)
  • Petah Tikva
  • Tel Aviv
  • Other Cities
• List of Upcoming Facilities in the Region (Area and Power Capacity)

REPORT COVERAGE:

This report analyses the Israel data center market share. It elaboratively analyses the existing and upcoming facilities and investments in IT, electrical, mechanical infrastructure, general construction, and tier standards. It discusses market sizing and investment estimation for different segments. The segmentation includes:

IT Infrastructure

• Servers
• Storage Systems
• Network Infrastructure

Electrical Infrastructure

• UPS Systems
• Generators
• Switches & Switchgear
• PDUs
• Other Electrical Infrastructure

Mechanical Infrastructure

• Cooling Systems
• Racks
• Other Mechanical Infrastructure

Cooling Systems

• CRAC and CRAH Units
• Chillers Units
• Cooling Towers, Condensers, and Dry Coolers
• Other Cooling Units

General Construction

• Core & Shell Development
• Installation & Commissioning Services
• Engineering & Building Design
• Fire Detection & Suppression
• Physical Security
• DCIM

Tier Standard

• Tier I & Tier II
• Tier III
• Tier IV

VENDOR LANDSCAPE

• IT Infrastructure Providers: Broadcom, Cisco Systems, Dell Technologies, Fujitsu, Hewlett Packard Enterprise, Hitachi Vantara, IBM, Juniper Networks, Lenovo, NetApp, Oracle.
• Data Center Construction Contractors & Sub-Contractors: M+W Group (Exyte), Mercury, MiCiM, Saan Zahav.
• Support Infrastructure Providers: ABB, Caterpillar, Cummins, Delta Electronics, Eaton, ETAP, HITEC Power Protection, Johnson Controls, Keysight Technologies, Legrand, Mitsubishi Electric, Rittal, Rolls-Royce, Schneider Electric, Siemens, STULZ, Vertiv.
• Data Center Investors: Adgar Investments & Development, Amazon Web Services, Bynet Data Communications, Bezeq International, Compass Datacenters, EdgeConneX, MedOne, Microsoft.
• New Entrants: Anan, Digital Realty, Global Technical Realty, NED Data Centers, Serverfarm, Techtonic.