Hyperscale operators and consumer-oriented cloud providers continue to expand their operations aggressively. Hyperscale operators and consumer-oriented cloud providers continue to expand their operations aggressively.
According to, in 2021, humanity created, copied, and consumed an estimated Statista 79 zettabytes of data. To put that in perspective, it would take a million supercomputers to store just one zettabyte.Keeping up with this tremendous spike in data usage, operators built or expanded over 515 facilities in 2021 alone. The Asia-Pacific region led the charge with 161, followed by Europe and North America.
Global Data Center Market – Key Insights
In 2021, colocation operators accounted for approximately 55% of the total market investment. Self-made hyperscale centers were also on the rise. Heavyweights like Facebook, Google, Amazon, and Microsoft contributed roughly 35% of the total area expansion.
Main Drivers of Data Center Growth
Driven by increased demand, the data center industry is expanding. Key considerations include:
The rise of remote work and learning.
- Development of data-hungry technologies such as IoT, Machine Learning, and AI.
- The digitization of business processes.
- The Industrial digital transformation.
- The rise in the number of small and medium enterprises adopting digital technology.
- COVID-19 Impact on the Market
The pandemic has acted as an accelerator and compressed many years’ worth of change into months. It also highlighted that technology had entered practically every part of our lives, generating an ever-increasing amount of data.
Maintaining the access and reliability of online services while dealing with rising demand proved to be a challenging task. Data centers rose to the challenge and ensured that companies remained functional and people’s daily lives were unaffected.
The pandemic also marked a watershed moment for the mass adoption of many advanced technologies. Cloud computing, AI, edge computing, Big Data, and 5G all experienced a massive kickstart during the pandemic.
Industries that Have Grown in Response to COVID-19
Platforms for online communication. As people became physically isolated, tools like Zoom, Skype, FaceTime, Microsoft Teams, and Google Hangouts have connected people virtually. Cloud services. With the rise in popularity of remote work, cloud services have become an integral part of business infrastructure.
Streaming services. Other Factors that Impact the Market The market is driven by the growing demand in Asia-Pacific. The data center industry has grown by 24 percent in Asia-Pacific according to recent reports. This demand for data has prompted China to approve the construction of ten data center clusters in strategic locations.
Similarly, there has been a 30% growth in the data center market in India since 2019. Digital economy in the subcontinent contributes to 9.5% of GDP. That figure includes 1.2 billion mobile phone subscriptions, indicating the massive scope of possible data center development in the future.
Another key factor to consider is the rapid digitalization of banking, financial services, and insurance companies around the world. They are increasingly dependent on Big Data for everyday tasks as they are one of the largest data generators. Financial institutions use technology in order to reduce operating costs, build infrastructure and generate crucial insights about their clients. The trend of banks running their own data centres is changing. Declining profits and expense drain mean financial services and banking firms are increasingly looking to outsource data services. Significant Investments in the Data Center Market Data centers offer an enticing opportunity to participate in the technology boom. Here are some of the leading investors:
Facebook leads the pack when it comes to hyperscale development, maintaining 19 data center campuses worldwide. Currently, the social media giant owns 40 million square feet of real estate worth more than $20 billion.
JPMorgan Chase, the world’s largest financial services company, spent $2 billion building new data centers in 2021. Additionally, they recently announced plans to invest even more.
Microsoft, Amazon, and Google continue to be significant drivers of growth in the data center market. In the coming years, there will be seven major trends that will influence the data center industry:
Climate Change Will Influence Site Selection
The mantra “location location location”, is more important than ever, as climate change changes the status quo. Investors should prioritize real estate with sufficient cooling, security, and electricity infrastructure.
Data Center as a Service
Many believe that Data Center as a Service is the next logical evolution from Infrastructure as a Service. Experts expect the DCaaS market size to reach $298.5 billion by 2026, with an estimated compound annual growth rate of 12.7%.
DCaaS provide all the benefits of IaaS plus infrastructure automation support via API and CLI, cloud-native infrastructure, and a completely customizable service, including managed and security services.
Remove infrastructure constraints and increase operational efficiency while Optimizing your Total Cost of Ownership with PhoenixNAP Data Center as a Service.
Resiliency, Uptime and Security Take Center Stage
In the data center industry, reliability is a priority. Backup and recovery services are becoming more important as businesses adopt hybrid cloud-based solutions. Supply Chain DisruptionsFor the data center business, supply chain concerns are real. Analysts believe that equipment delays and shortages of labor will have a greater impact in 2022.
Blockchain and Web3 Growth
Many Web3, blockchain, and decentralized financial apps rely upon standard cloud and dedicated servers infrastructure. All investments in this area will, of course, drive significant demand for Data Centers.
More Intense AI Infrastructure
Artificial intelligence and automation could transform not only the data center market but the infrastructure of a data center itself. AI models that require large datasets and new hardware will continue to be required.
Cloud-Like Bare Metal Servers
Striking a mix between performance and cost, Bare Metal Cloud Servers integrate the best features of a dedicated and cloud server. The global Bare Metal Cloud market is expected to reach $16.4 billion by 2026, up from 4.5 billion in 2020.
Deploying dedicated servers should not be a time-consuming and frustrating experience. We built Bare Metal Cloud to help you deploy and manage physical servers with cloud-like ease and simplicity.
Key Takeaways
Data centers are the digital world’s cornerstone and are becoming essential in every industry. They are essential to the growth of other information technology areas. By 2025, the industry’s revenues are likely to exceed $58 billion. This presents investors with an opportunity for sustainable growth.
About The Author
