According to Arizton’s latest research report, the global data center colocation market is growing at a CAGR of 10.97% during 2023-2029.
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Report Scope:
Market Size – Investment (2029): $80.37 Billion
Market Size – Investment (2023): $43.04 Billion
CAGR – Investment (2023-2029): 10.97%
Market Size -Area (2029): 47.72 Million Square Feet
Market Size – Power Capacity (2029): 9,497 MW
Market Size – Revenue (2029): $112.77 Billion
Historic Year: 2020-2022
Base Year: 2023
Forecast Year: 2024-2029
Market Segmentation: Colocation Service, Infrastructure, Electrical Infrastructure, Mechanical Infrastructure, Cooling Systems, Cooling Techniques, General Construction, Tier Standards, and Geography
Geographical Analysis: North America, Latin America, Western Europe, Nordics, Central & Eastern Europe, Middle East, Africa, APAC, and Southeast Asia
The Global Data Center Colocation Market: Key Regions Driving Growth
The United States: A Leading Force in Colocation
The US continues to dominate the global data center colocation market, bolstered by significant investments from major players like Equinix, Digital Realty, and CyrusOne. Key regions such as Silicon Valley, Northern Virginia, and Dallas serve as the primary hubs for new colocation facility developments, reflecting the country’s robust data infrastructure and demand.
Latin America: Emerging Investment Hotspot
Latin America is experiencing growing investments in colocation facilities, with Mexico and Brazil leading the charge. Mexico, in particular, saw a milestone achievement in July 2024 with the completion of ODATA’s QR02 facility, underscoring the region’s increasing prominence in the global data center landscape.
Europe: Sustained Growth in Key Markets
The European colocation market is witnessing significant expansion, particularly in the UK, Germany, and France. In the UK, regions such as London, Manchester, and Slough are emerging as hotspots for data center growth. Notable investments from operators like Ark Data Centres and Equinix are driving this upward trajectory, solidifying Europe’s position as a key player in the colocation market.
The Global Data Center Colocation Market: Revenue Growth and Emerging Trends
CyrusOne: Strong Performance and Expansion
CyrusOne, a major player in the colocation market, reported $1.5 billion in colocation revenue, reflecting a 7.1% increase. This growth is attributed to its continued investments in new data centers and global expansion, particularly in North America. The rise in demand for scalable and secure data storage solutions has fueled this robust performance.
GDS Services: Expanding in Asia
In 2023, GDS Services recorded $1.40 billion in revenue, marking a 7.7% increase from the previous year. With a market share of approximately 2.32%, GDS’s growth is driven by the ongoing expansion of its data centers in China and Southeast Asia. Meanwhile, VNET Group and QTS also posted steady growth, with revenues of $1.32 billion and $930 million, respectively, each showing a 3.3% increase.
Chindata: Growing Presence in Southeast Asia
Chindata, a prominent player in Southeast Asia, reported $820 million in revenue for 2023, reflecting a 5.1% increase compared to 2022. This growth is bolstered by its merger with Bridge Data Centres and its strong regional presence in Southeast Asia, helping it expand its market footprint.
Smaller Players Gaining Ground
The “Others” category, which includes smaller players like STACK Infrastructure, DataBank, VIRTUS Data Centres, and Switch, accounted for 49.43% of the market share in 2023. These companies generated $29.86 billion in revenue, experiencing a 3.4% increase from the previous year. While these smaller companies continue to play a significant role, especially in regional and niche markets, larger players still dominate the overall market share.
Shifting Market Dynamics
The global data center colocation market is witnessing a shift, with smaller operators gaining ground. However, major players such as Equinix, China Telecom, and Digital Realty maintain a dominant position, thanks to their large-scale operations and global infrastructure. As the market continues to grow, both leading and emerging companies are making substantial investments in infrastructure to capture regional market share, ensuring that the sector remains one of the fastest-growing industries globally.
Retail vs Wholesale Colocation: Market Growth and Trends
The global data center colocation market is poised for significant growth from 2024 to 2029, driven primarily by the rising demand for wholesale/hyperscale colocation services. The market is expected to grow at a Compound Annual Growth Rate (CAGR) of 10.96% during this period, with a substantial increase in revenue, particularly fueled by the expanding needs of AI and machine learning technologies.
From 2020 to 2023, the market saw consistent year-over-year growth, with revenue climbing from USD 42.89 billion in 2020 to USD 60.41 billion in 2023. This trend highlights the ongoing adoption of colocation services across industries globally.
The market has also experienced an influx of new entrants, with more than 40 companies joining the space in the past two years. These new players mainly include real estate asset management firms and subsidiaries of power producers, signaling a diversification of participants in the colocation industry.
Moreover, the wholesale colocation segment is the expansion of data center capacity by leading cloud service providers. This segment is particularly attractive to enterprises with high-capacity needs, especially in cloud, big data, and AI applications, making wholesale colocation the preferred option for businesses with demanding infrastructure requirements.
The Report Includes the Investment in the Following Areas:
Colocation Services
Infrastructure
Electrical Infrastructure
Mechanical Infrastructure
Cooling Systems
Cooling Techniques
General Construction
Tier Standards
Geography
North America
Latin America
Western Europe
Nordics
Central & Eastern European Countries
Middle East
Africa
APAC
Vendors Landscape
Prominent Colocation Operators
New Entrants
The Arizton Advisory & Intelligence market research report provides valuable market insights for industry stakeholders, investors, researchers, consultants, and business strategists aiming to gain a thorough understanding of the data center colocation market. Request for Free Sample to get a glance of the report now: https://www.arizton.com/market-reports/global-data-center-colocation-market
What Key Findings Our Research Analysis Reveals?
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