The Data Center Market Is Booming Due To the Increasing Data Processing Across Enterprises

The Data Center Market Is Booming Due To the Increasing Data Processing Across Enterprises

Nearly $432.14 billion will be invested in the data center global market by 2025, reports Frost & Sullivan.

With the continued high levels of technology deployment across businesses globally, there is a proliferation of the data created. This is driving the need for data processing as well as storage capacity, reveals a recent Frost & Sullivan’s research study.

The outcome would be assembling large volumes of data centers, ranging from enterprise-level to large-scale cloud solutions. It is estimated that $432.14 billion capital will be invested in the data center market by 2025 – which is up from $244.74 billion in 2019. The CAGR for the forecast period is about 9.9%.

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As a result, the Asia-Pacific region will become the largest market by 2025. This is followed by North America and the EMEA area. The factors that will serve as key market drivers are –

  • Increased investments by the data center operators,
  • Better deployment and usage of Big Data and IoT,
  • Adoption of hybrid models with traditional data centers and cloud,
  • Robust growth in the emerging economies

With the sudden move from enterprise to cloud, data centers are most likely to gain momentum because businesses can reduce operational costs and capital. This can certainly be done by avoiding investments around hardware or software infrastructure while lowering maintenance and space requirements at the same time.

“Additionally, 5G will move processing closer to the point of data collection, leading to increased deployment of micro and edge data centers and driving investments in new and next-generation data center technologies.” – explains Manoj Shankar, Research Analyst at Frost & Sullivan in the company blog.

In fact, the onsite cloud data centers will become essential as enterprises will need critical data to be saved in-house or nearby. This, thereby, will lessen the cyber-security risks such as data theft, BEC attack, and so on.

Moreover, with the high demand for competitive pressures and modular data centers, modular data center manufacturers are required to innovate in this segment and come up with more advanced concepts. This is certainly to allow added flexibility and modularity within enterprise workflow.

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Looking into the opportunities for the data center market, 5G revolution, edge computing, and the increasing adoption of artificial intelligence will drive the data center activity. They are also expected to provide remarkable opportunities to the market participants, like –

  • Edge computing – Connected devices, connected living, AI, video streaming and virtual and augmented reality will drive the demand for edge data centers.
  • Artificial intelligence – The surging AI usage in data centers will lead to rising demand for advanced tools and specialists in AI-based solutions. This is primarily for data center applications and business technology architecture.
  • Innovative capabilities: Data processing takes place close to the source, and the processing time will reduce. This will certainly augment technologies like augmented reality, smart devices, and sensors, etc.

Market expansion and partnerships: Market participants are required to focus on high-growth, emerging markets such as India and Southeast Asia. Data creation in these regions is still in the budding stage, and data center building in its early stages. Hence, partnerships with cloud service providers and colocation will enable the equipment manufacturers to access new data center markets, allowing them a considerable boost.

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