$13 Bn Data Center Construction Market in Europe - Industry Outlook and Forecast 2019-2024

DUBLIN, May 3, 2019 /PRNewswire/ -- The "Data Center Construction Market in Europe - Industry Outlook and Forecast 2019-2024" report has been added to ResearchAndMarkets.com's offering.

Europe data center construction market is expected to reach around $13 billion by 2024, growing at a CAGR of over 4% during 2018-2024.

The increased procurement of renewable energy sources for data centers operations, the rise in data center automation, and the emergence of Lithium-ion batteries and fuel cells are expected to drive the Europe data center construction market. Ericsson, Deutsche Telekom, Telia Sonera, Telenor, and Tele2 TDC Group along with government agencies are investing a high capital in improving internet connectivity in Western Europe and the Nordic region.

The Europe data center construction market is expected to grow due to increased investments from colocation, cloud, internet, and telecommunication service providers. Further, growth in data, general data protection regulation (GDPR), the popularity of social media, high adoption of smart wearable devices, and the rise of connected reality will be significant growth drivers for Europe data center construction market.

Europe Data Center Construction Market: Dynamics

Europe is one of the leading active data center markets, which is expected to grow at a CAGR of 16% during the forecast period. According to the Global Interconnection Index by Equinix Frankfurt, about 70% of the data traffic is concentrated in Germany, France, Italy, Spain, and the UK. London is expected to be the largest interconnection market. Hyperscaleservice providers are actively investing in the Europe data center construction market.

For example, Microsoft is expected to open its cloud region in Germany by the end of 2019 or early 2020. The investment in data center technology, especially edge computing facilities, is expected to grow in several facilities after 2020 in the European region. EdgeConnex is among the leading-edge datacenter operator that is likely to increase its presence in the European market with operations in Amsterdam, Dublin, Munich, and Warsaw.

The augmenting numbers of connected devices are expected to triple by the end of the forecast period, and the investment on edge computing facilities will grow post-2020 in the region. EdgeConnex and other colocation service providers have also planned to establish facilities in the Europe data center construction market.

Europe Data Center Construction Market: Segmentation

The Europe data center construction market by electrical infrastructure can be classified into UPS systems, generators, transfer switches and switchgears, rack PDUs, and others (utility transformers, power cables and panels, lighting equipment, installation services, busbars, circuit breakers, and TVSS systems). The UPS systems and generators segments account for significant market shares and are expected to grow at CAGRs of approximately 5% and 4%, respectively, during 2018-2024. In 2019, western Europe is likely to witness the opening of over 20 data center projects with the power capacity of more than 10 MW. The European data center market is adopting pre-fabricated datacenters, which will add more revenue for less than 1 W UPS systems.

The Europe data center construction market by mechanical infrastructure can be classified into cooling systems, racks, and others. The cooling systems segment has captured a major portion of the European market and is expected to grow at a CAGR of over 4% during 2018-2024. Computer room air conditioners (CRAC), computer room air handlers (CRAH), chillers, cooling towers, and dry coolers are the commonly adopted cooling infrastructure in the Europe data center construction market. The use of indirect evaporative cooler and air/water-side economizers will continue to grow in Nordic countries and Northern Western Europe, facilitating free cooling for a minimum of 8,000 hours per year.

The Europe data center construction market by tier standards can be divided into Tier I&II, Tier III, and Tier IV. Tier IV data center facilities are the fastest growing segment in the Europe data center construction market and are expected to grow at a CAGR of approximately 6% during 2018-2024. The Uptime Institute has developed a Tier Classification System (tier I4), which evaluates datacenter facilities based on their infrastructure performance, efficiency, redundancy, and high availability. In 2017, Switch, a leading data center developer and operator, designed a tier V data center, which covers the entire data center design and development, including the use of renewable energy sources as a classification parameter.

Building development and designing, installation and commissioning services, physical security, and DCIM (data center infrastructure management software) are major constituents of the general construction segment. Building development and installation and commissioning services are the fastest growing segments and are expected to grow at a CAGR of around 3% and 5%, respectively.

While increased hyperscale investments by companies such as AWS, Google, Facebook, Apple, and Microsoft will increase a high demand for skilled workforce in several European countries, including Denmark, Ireland, Germany, etc., the data center market in Western Europe will witness an increase in facility designs that support OCP infrastructure operations.

Key Vendor Analysis

Multiple initiatives by hyperscale service providers to reduce the cost of efficient infrastructure services are expected to aid the growth of the Europe data center construction market. Infrastructure resellers and distributors are expected to compete with each other in the region. The demand for cloud data service and high-density operations is expected to grow during the forecast period. Partnerships with local and modular data center service providers will increase revenues for global vendors operating in the market. The need for installation, commissioning, and maintenance services will generate local job opportunities in the market.

Market Dynamics

Market Growth Enablers

• GDPR Driving Cloud Demand in Europe
• Big Data and IoT to Increase Data Center Investments
• Government Support to Grow Data Center Investments
• Higher Demand for Colocation Services
• Growing Submarine Cable Investments in Europe

Market Growth Restraints

• Increase in Power Outages and Fluctuations
• Lack of Skilled Workforce
• Increased Carbon Emissions from Data Centers

Market Opportunities & Trends

• Higher Procurement of Renewable Energy for Data Centers
• Growth in Mergers & Acquisitions
• Increased Automation of Data Centers
• Emergence of Lithium-ion Batteries and Fuel Cells in Data Centers
• District Heating in European Data Centers

Prominent Construction Contractors

• AECOM
• Arup Group
• Bruce Shaw
• Cap Ingelec
• DPR Construction
• Etix Everywhere
• Flex Enclosure
• Future-tech
• Jones Engineering
• KMCS
• LUPP Group
• Mace group
• Mercury engineering
• NCC
• Red Engineering
• Skanska
• SISK Group
• Structure Tone

Prominent Infrastructure Providers

• ABB
• Bosch Security
• Caterpillar
• Cummins
• Eaton
• EURO-DIESEL
• Hitec Power Protection
• KOHLER
• Legrand Group
• MTU OnSite Energy
• Nlyte Software
• Piller Power Systems
• Riello UPS
• Rittal
• Schneider Electric
• Socomec Group
• STULZ
• Vertiv

Prominent Data Center Investors

• Adgar
• Advania Data Center
• Apple
• Aruba
• AWS
• Colt Data Centre Services (Colt DCS)
• CyrusOne
• Digital Realty
• Equinix
• Facebook
• Google
• Global Switch
• Iliad Data Center
• Interxion
• IXcellerate
• Microsoft
• NTT Communications
• OVH
• STT GDC
• T-Systems
• T5 Data Centers
  

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