NEW YORK, Jan. 3, 2018 /PRNewswire/ -- The global market for colocation data center industry is expected to grow from $30.9 billion in 2016 to $54.8 billion by 2020, at a compound annual growth rate (CAGR) of 15.4% for the period of 2016-2020.
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• Americas as a segment is expected to grow from nearly $16.8 billion in 2016 to $26.4 billion by 2020, at a CAGR of 12.0% for the period of 2016-2020.
• Asia-Pacific as a segment is expected to grow from $5.4 billion in 2016 to $13.2 billion by 2020, at a CAGR of 25.0% for the period of 2016-2020.
Chapter 1: Introduction
BCC Research's goal in performing this study was to determine the global market and future demand growth for colocation data centers over the four-year period from 2016 through 2020. Of particular focus was characterizing and quantifying the potential of the market for colocation data centers by geography, and product.
The report also evaluates the market segments. Opportunities in lucrative segments have been discussed in detail.
Factors that affect the market such as drivers, restraints, and trends have been discussed. The key objective was to present a comprehensive discussion of colocation data centers market and forecast the future potential for the key market segments/geographies.
This discussion provides a basis for companies to make strategic choices about developing new products and markets or deciding which applications are needed in their organizations. The study will benefit colocation datacenter providers, new entrants, users of colocation services, cloud service providers, various industry verticals such as Banking, Financial Services and Insurance, governments around the world, and others.
Study Goals and Objectives
• To sum up the colocation data centers market size.
• To estimate the growth rate of the global and USA colocation data centers market.
• To segment the market.
• To provide market numbers geographically.
• To identify major drivers and restraints.
• To identify key trends and technology updates in the field.
• To highlight strategies and potential opportunities in the market.
Reasons for Doing This Study
The increasing presence of technologies such as artificial intelligence (AI), big data and IoT across all the industries has led to increasing demand for data storage globally. Global industry leaders and large organizations see an increasing trend of outsourcing their data needs across various industries.
Increasing demand from cloud companies in the technology, financial services and healthcare industries is expected to drive this market. Many companies are expanding their geographical presence inorganically through the mergers and acquisitions.
Moreover, there is an increasing government support for IT initiatives driving growth. The cloud market is expected to increase with more hyperscale providers. These factors are expected to drive the global colocation data centers market.
The market for colocation data centers is fragmented with only a few large players having more than 5% market share. Major players in the market include Equinix, Digital Realty, NTT Data, Century Link (Cyxtera), Cyrus One and others.
Scope of Report
This research report focuses on market sizing and forecast for global, USA and other regions. It categorizes the colocation data center market by service type.
Service types include retail and wholesale. It also includes the market analysis by customer industries and competitor analysis.
• Public information via annual reports to shareholders as well as other government reports that are available for public review.
• Company marketing information, advertising, company press releases, state and local news sources, and subscription-based information.
• Online research including third-party references.
• Trade associations, directories and publications.
• Telephone interviews with both top industry experts, service providers, software providers and others.
• Various proprietary data sources.
Research methodology followed in this report is a top-down approach. Various sources were used to arrive at the total market figure, which was broken down into various services and geographies based on primary and secondary data.
Both a quantitative and qualitative approaches were used to derive the market size and growth rates. Many secondary sources were reviewed and extensive primary research was conducted with key opinion leaders, marketing managers, product managers and end users. With 10+ interviews conducted. Please see appendix for the details of these.
Market numbers have been calculated in constant U.S. dollars at 2016 conversion rates.
In this report, the geographic regions considered for market analysis include, and only include:
• United States
• Europe Middle East and Africa
• Americas excluding USA
Colocation Data Centers, by Service Type
- Colocation Data Centers
- Wholsale Colocation Data Centers
Chapter 2: Summary and Highlights
This report analyzes the market for colocation data centers globally and in the USA. Colocation data centers are being preferred by many industry verticals due to their increasing data needs. Data centers serve mainly to the cloud, technology, banking and financial services and healthcare industries.
Colocation data centers are classified in to two main segments, retail and wholesale. The retail segment is larger than the wholesale due to the increased use of IoT in small and medium enterprises which prefer convenience and space saving of external data centers.
Going forward, this market is expected to grow further due to the increase in out sourcing data centers, growing presence of artificial intelligence (AI) and big data across all the industries.
The global colocation data centers market in 2016 was estimated to be around $ 30.9 billion. During 2016-2020 global colocation data centers market is expected to grow at a CAGR of 15.4%, to reach $54.8 billion by the year 2020.
This growth can be attributed to the expansion of major cloud and colocation companies to new geographies. And the market is expected to increase in Asian countries such as China and Singapore due to the increasing use of big data and ERP (enterprise resource planning) across all the industries and government regulations to restrict the amount data storage in the local region.
Cloud, technology and banking, financial services, and insurance was the largest customer group for colocation data centers accounting for more than 50% of the market followed by telecom and healthcare. The total revenues from cloud, technology and banking, financial services, and insurance were $17.8 billion. This large share of revenues can be attributed to increasing demand from cloud operators, growth in outsourcing data centers and increasing demand from financial services industry.
In 2016, the USA colocation data centers market accounted for 45.4% market, followed by Europe and Asia Pacific with 28.1% and 17.5% market respectively.
The global colocation data centers market is relatively fragmented, with only two global players having more than a 5% market share. The top five competitors in the market accounted for 21.1% of the total market in 2016. Equinix was the largest company with 8.5% of the market, followed by other companies such as Digital Reality, NTT Data with and CenturyLink (Cyxtera).
To be successful any colocation datacenter provider should partner with cloud companies and offer its services to target wider customer base. They should provide additional facilities such as interconnection and firewall management to differentiate their service from others. These facilities will reduce upfront costs for colocation customers and make colocation data centers more attractive in an increasingly competitive market.
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