Data Center

Market Insights Technology

Worldwide

Revenue in the Data Center market is projected to reach US$416.10bn in 2024.
Network Infrastructure dominates the market with a projected market volume of US$239.70bn in 2024.
Revenue is expected to show an annual growth rate (CAGR 2024-2029) of 8.45%, resulting in a market volume of US$624.10bn by 2029.
In global comparison, most revenue will be generated in the United States (US$123.20bn in 2024).

Key regions: United States, Germany, India, Japan, China

Definition:

The Data Center market is a critical segment of the technology industry focusing on supplying and managing physical infrastructure necessary for hosting and operating IT systems, primarily servers, storage, and network equipment. This market spans from traditional in-house data centers to sophisticated facilities offered by specialized providers, covering services like hosting, shared data center facilities, and managed data center solutions. It targets a diverse client base, ranging from small businesses to large enterprises, offering flexible, scalable solutions for their IT infrastructure needs. This sector is integral to the efficient functioning and security of IT operations in various organizations.

Structure:

The Data Center market is structured in three markets based on the services model provided by the companies.

The Server market covers the resources and services related to servers, integral for hosting websites, managing databases, and supporting cloud computing.
The Storage market covers the resources and services related to data storage systems, crucial for archiving, data backup, and ensuring data recovery.
The Network Infrastructure market covers the resources and services related to network hardware essential for ensuring connectivity, data transmission, and network security.

Additional Information:

The Data Center market includes revenue, revenue change, average spend per employee, and key player market shares as key performance indicators. Market values represent revenues paid to primary vendors at the manufacturer price level either directly or through distribution channels (excluding VAT). Revenues are generated through both online and offline sales channels and include spending by consumers (B2C), enterprises (B2B) as well as governments (B2G). Detailed definitions of each market can be found on the respective page where the market data is displayed.

Key players in the Data Center market include companies such as Dell, HPE, Huawei, and Ericsson.

For more information on the data displayed, use the info button right next to the boxes.

in-scope

Network Infrastructure, such as Cisco Routers and Switches, and Arista Network Ethernet Switches
Infrastructure Firewalls, such as Palo Alto Network Next-Generation Firewall, and Fortinet FortiGate Firewalls
Servers, such as Dell PowerEdge Servers, HPE ProLiant Servers, and IBM Power Systems
Storage, such as Dell EMC Storage Solutions, and NetApp Data Storage Systems

out-of-scope

IT Infrastructure for Private Environments, such as VMware vSphere, and Cisco UCS
Software, such as Microsoft Windows Server, and Red Hat Enterprise Linux
Cloud Hosting Services, such as AWS, Microsoft Azure, and GCP
Network Infrastructure Services, such as IT Support Services, and Home Internet Services Providers (ISPs)

Servers
Storage
Network Infrastructure
- Service Provider Network Infrastructure
- Enterprise Network Infrastructure

Related markets:

Devices

Software

IT Services

Public Cloud

Cybersecurity

Analyst Opinion

Despite subdued growth, the global data center market is still experiencing significant expansion. Factors such as the increasing use of digital technologies, growing awareness about health, and the convenience of online services are driving this growth. Additionally, the markets for servers, storage, and network infrastructure are further propelling the overall market.

Customer preferences:

As the demand for data storage and processing continues to grow, consumers are increasingly seeking more sustainable and environmentally-friendly options. This trend is driven by a growing awareness of the impact of data centers on the environment, and a desire for companies to adopt greener practices. Additionally, with the rise of remote work and virtual meetings, there is a growing need for reliable and efficient data centers to support the digital infrastructure of businesses and organizations. This has led to an increased focus on energy-efficient designs and renewable energy sources in the data center market.
Trends in the market:
In the Data Center Market, there is a notable shift towards edge computing as organizations seek to lower latency and improve network performance. This trend is driven by the increasing demand for real-time data processing and the proliferation of Internet of Things devices. As a result, the market for edge data centers is expected to grow significantly in the coming years. This trajectory has significant implications for industry stakeholders as they adapt to the changing landscape and invest in edge infrastructure. Additionally, the rise of edge computing may lead to a decrease in demand for traditional centralized data centers, impacting the design and construction of future facilities.
Local special circ*mstances:
In the Data Center Market, geographical factors play a crucial role in market dynamics. For instance, in North America, the presence of tech giants and favorable government policies have fueled the growth of the market. In contrast, the market in Europe is driven by strict data privacy laws, leading to the adoption of advanced data security measures. In Asia Pacific, the demand for data centers is driven by rapid digitalization and government initiatives promoting cloud computing. These unique local factors shape the Data Center Market landscape and drive its growth in different regions.
Underlying macroeconomic factors:
The Data Center Market is heavily impacted by macroeconomic factors, including global economic trends, national economic health, fiscal policies, and financial indicators. The growth of this market is largely dependent on the level of technological advancements and investment in digital infrastructure. Countries with favorable regulatory environments and strong investment in digital technologies are experiencing faster market growth compared to regions with regulatory challenges and limited funding. The increasing demand for data storage and processing solutions, driven by the growing volume of digital data and the adoption of cloud-based services, is also fueling the expansion of the Data Center Market.

Methodology

Data coverage:

The data encompasses B2B enterprises. Figures are based on hardware-related expenses of businesses for setting up and maintaining an IT infrastructure.

Modeling approach / Market size:

Market sizes are determined through a top-down approach, building on a specific rationale for each market segment. As a basis for evaluating markets, we use annual financial reports and national statistical offices. In addition, we use relevant key market indicators and data from country-specific associations, such as GDP and level of digitization. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques, such as exponential trend smoothing and the S-curve function, is based on the behavior of the relevant market.

Additional notes:

The data is modeled using current exchange rates. The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic and the Russia-Ukraine war is considered at a country-specific level.