Global Data Center Solutions Market Size, Share & Trends Analysis Report By Offering, By Tier Type (Tier 4, Tier 3, Tier 2, and Tier 1), By Data Center Size, By Data Center Type, By Regional Outlook and Forecast, 2023 - 2030

Global Data Center Solutions Market Size, Share & Trends Analysis Report By Offering, By Tier Type (Tier 4, Tier 3, Tier 2, and Tier 1), By Data Center Size, By Data Center Type, By Regional Outlook and Forecast, 2023 - 2030

The Global Data Center Solutions Market size is expected to reach $711.5 billion by 2030, rising at a market growth of 11.5% CAGR during the forecast period.

Virtualization software allows organizations to abstract physical hardware resources and create virtual instances of servers, storage, and networking components. Therefore, the virtualization software segment captured $9,558.1 million revenue in the market in 2022. By consolidating multiple virtual machines (VMs) onto a single physical server, virtualization enables organizations to optimize resource utilization, reduce hardware sprawl, and maximize data center infrastructure efficiency.

The major strategies followed by the market participants are Geographical Expansions as the key developmental strategy to keep pace with the changing demands of end users. For instance, In August, 2022, Microsoft Corporation launched a new datacenter region in Qatar. The state-of-the-art datacenters provide Microsoft Azure and Microsoft 365 services, facilitating access to scalable, highly available, and resilient cloud services and accelerating digital transformation for businesses and partners across Qatar. Additionally, In April, 2022, Google LLC is allocating a staggering $9.5 billion towards new data centers and U.S. offices, a move expected to generate "at least" 12,000 new full-time jobs by year's end.

Based on the Analysis presented in the KBV Cardinal matrix; Google LLC and Microsoft Corporation are the forerunners in the Market. For instance, In May, 2023, Microsoft Corporation has launched its latest cloud region, the first in Central and Eastern Europe, situated in Poland. This development marks a significant step in Poland's digital transformation and connects it to the world's most extensive cloud infrastructure. Companies such as Equinix, Inc., Huawei Technologies Co., Ltd., KDDI Corporation are some of the key innovators in Market.

Market Growth Factors

Globally, organizations are increasingly moving their IT infrastructure and services to cloud platforms, leading to a surge in demand for data centers that can support and integrate with cloud environments. Cloud computing offers scalability, allowing businesses to scale their operations and resources based on demand. These solutions become essential to provide the underlying infrastructure that supports the scalability requirements of cloud services. Therefore, the rising adoption of cloud computing is propelling the growth of the market.

Additionally, the rollout of 5G technology significantly increases data traffic due to higher data speeds and improved network capacity. The sector's firms generated a combined business profit of around 197.9 billion U.S. dollars (approximately 1.4 trillion yuan), representing a year-on-year increase of 6.9 percent. Similarly, as per the International Trade Administration, the 5G has attained 53% coverage rate in Saudi Arabia. The cumulative capital investment of Saudi Arabia in digital infrastructure surpassed $24.8 billion during the preceding six years. Thus, the increasing 5G rollout is driving the growth of the market.

Market Restraining Factors

Investing in compliance certifications, physical security systems, and cybersecurity measures adds to the initial costs, particularly for data-sensitive industries. Organizations often require customized data center solutions tailored to their specific needs. Designing and implementing such customized infrastructure, which is also scalable for future growth, entails additional costs contributing to the overall high initial investment. Therefore, the high initial investment hampers the growth of the market.

By Offering Analysis

Based on offering, the market is divided into hardware, software, and services. In 2022, the hardware segment recorded 50.14% revenue share in the market. The hardware of the data center is of the utmost importance in guaranteeing data security and adherence to regulatory obligations. This includes hardware-based security features such as encryption, secure boot, and hardware-based authentication to protect data and infrastructure from cyber threats.

By Hardware Analysis

The hardware segment is further subdivided into IT modules, power modules, and cooling modules. In 2022, the IT modules segment garnered 43.08% revenue share in the market. IT modules offer a modular design approach that allows data center operators to scale infrastructure resources flexibly and cost-effectively. Modular IT solutions enable organizations to incrementally add computing, storage, and networking capacity as their business needs evolve, avoiding over-provisioning and minimizing upfront capital expenditures.

By Software Analysis

The software segment is further subdivided into monitoring & management tools, automation & orchestration software, backup & disaster recovery, security software, virtualization software, and analytics software. The monitoring & management tools attained 28.21% revenue share in the market in 2022. Data center environments have become increasingly complex, encompassing diverse physical and virtual infrastructure components distributed across on-premises, cloud, and edge locations.

By Services Analysis

The services segment is further subdivided into design & consulting, integration & deployment, and support & maintenance. In 2022, the support & maintenance segment acquired 45.79% revenue share in the market. With the growing adoption of data centers across various industries, there is a greater need for support and maintenance services to ensure their continuous and efficient operation. Many businesses require their data centers to be operational 24/7 to meet the demands of a globalized, always-on economy.

By Tier Type Analysis

Based on tier type, the market is categorized into tier 1, tier 2, tier 3, and tier 4. The tier 1 segment attained a 12.58% revenue share in the market in 2022. Tier 1 data centers represent the entry-level tier of data center infrastructure, providing basic reliability and uptime for organizations with modest IT requirements. These facilities typically offer minimal redundancy and fault tolerance, making them suitable for non-mission-critical applications and workloads that can tolerate occasional downtime.

By Data Center Size Analysis

Based on data center size, the market is divided into small data centers, mid-sized data centers, and large data centers. The large data centers segment attained 50.92% revenue share in the market in 2022. The growing demand for large data centers drives significant investments in data center infrastructure, including servers, storage systems, networking equipment, and cooling systems.

By Data Center Type Analysis

On the basis of data center type, the market is segmented into cloud data center, colocation data center, enterprise data center, modular data center, and edge data center. The colocation data center segment held a 16.81% revenue share in the market in 2022. Organizations collocate their servers and IT infrastructure in colocation data centers to benefit from the facilities' robust infrastructure, including power, cooling, security, and connectivity.

By Vertical Analysis

On the basis of vertical, the market is categorized into BFSI, IT & telecom, government & defense, healthcare & life sciences, transportation, retail, energy & utilities, manufacturing, and others. The BFSI segment garnered 24.86% revenue share in the data centers solutions market in 2022. The BFSI sector deals with sensitive customer information and is subject to strict regulatory requirements regarding data security and privacy.

By Regional Analysis

Region-wise, the market is analyzed across North America, Europe, Asia Pacific, and LAMEA. In 2022, the Asia Pacific region generated a 27.55% revenue share in the market in 2022. This region has a growing population of mobile and internet users, driving demand for data center solutions supporting mobile applications, social media platforms, and online services. Data center operators are investing in edge computing infrastructure to deliver low-latency experiences and improve performance for mobile and internet users.

Recent Strategies Deployed in the Market

• Jan-2024: Amazon Web Services, Inc. expanded its geographical presence by investing to build two data center complexes in Mississippi, expanding its capacity to meet growing demand for cloud services driven by AI adoption. Working with MCEDA, it established multiple data center units in Madison County, expected to create over 1,000 jobs.
• Jan-2024: Google LLC teamed up with Danfoss, an energy efficiency leader, to enhance the customer experience, streamline internal processes, and boost productivity. The partnership involves using Danfoss' heat reuse modules to capture and repurpose heat from data centers, providing renewable energy for heating on site and in nearby buildings, communities, and industries.
• Dec-2023: Google LLC has started constructing a new data center in Winschoten, Groningen, described as a satellite to its Eemshaven site. Details on specifications, timelines, and waste heat utilization were not disclosed. The site will also incorporate rooftop solar panels.
• Dec-2023: CoreSite expands its New York and Denver data center campuses to meet increased capacity and power demands from cloud providers, enterprises, and service providers. NY3 in New York, spanning 85,000 square feet with 15 critical megawatts (CMW) of capacity, has received final permitting. In Denver, CoreSite gains conceptual approval for a three-building, 600,000-square-foot campus capable of 60 CMW capacity.
• Nov-2023: Amazon Web Services, Inc. expanded its partnership with DXC Technology, a leading Fortune 500 global tech services company, to speed up customers' transition to modern, cloud-focused IT. The multi-year expansion includes three strategic components: accelerated cloud migration and modernization, workforce transformation, and asset transformation.

List of Key Companies Profiled

• Amazon Web Services, Inc. (Amazon.com, Inc.)
• Google LLC (Alphabet Inc.)
• Microsoft Corporation
• Equinix, Inc.
• Huawei Technologies Co., Ltd. (Huawei Investment & Holding Co., Ltd.)
• Dell Technologies, Inc.
• KDDI Corporation
• Hewlett Packard enterprise Company
• Cyxtera Technologies, Inc. (BC Partners and Medina Capital)
• CoreSite (American Tower Corporation)

Global Data Center Solutions Market Report Segmentation

By Offering

• Hardware
• IT Modules
• Power Modules
• Cooling Modules
• Software
• Monitoring & Management Tools
• Automation & Orchestration Software
• Backup & Disaster Recovery
• Security Software
• Virtualization Software
• Analytics Software
• Services
• Support & Maintenance
• Integration & Deployment
• Design & Consulting

By Tier Type

• Tier 4
• Tier 3
• Tier 2
• Tier 1

By Data Center Size

• Large Data Centers
• Mid-Sized Data Centers
• Small Data Centers

By Data Center Type

• Enterprise Data Center
• Modular Data Center
• Colocation Data Center
• Cloud Data Center
• Edge Data Center

By Vertical

• BFSI
• Government & Defense
• Energy & Utilities
• Healthcare & Lifesciences
• Transportation
• IT & Telecom
• Retail
• Manufacturing
• Others

By Geography

• North America
• US
• Canada
• Mexico
• Rest of North America
• Europe
• Germany
• UK
• France
• Russia
• Spain
• Italy
• Rest of Europe
• Asia Pacific
• China
• Japan
• India
• South Korea
• Singapore
• Malaysia
• Rest of Asia Pacific
• LAMEA
• Brazil
• Argentina
• UAE
• Saudi Arabia
• South Africa
• Nigeria
• Rest of LAMEA

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