The data centre colocation market is estimated to be worth US$69.7bn in 2024 and is projected to be valued at US$279.1bn in 2034. Between 2024 and 2034, the industry is expected to register a growth rate of 14.9%.
The growing need for scalable and reliable IT infrastructure in industries owing to digital transformation is expected to drive the growth of the data centre colocation market during the forecast period. The rising reliance on cloud services fuels the demand for colocation facilities that provide connectivity and support for cloud deployments. Colocation complements cloud strategies, offering hybrid solutions for businesses.
Colocation facilities implement advanced security protocols, including physical security, network security, and compliance with industry standards, ensuring data protection and minimising cyber security risks driving the growth of the data centre colocation in various industries. The growing unique IT infrastructure requirements due to compliance and security needs in finance and healthcare, lead to tailored colocation solutions catering to these sectors.
The data centre colocation market in the United States continues to evolve, driven by technological advancements, changing business needs, and the growing importance of reliable, scalable, and secure data infrastructure. The Europe data centre colocation market is currently undergoing substantial growth, primarily propelled by the expanding utilisation of IoT, cloud computing, and AI/ML technologies.
Key takeaways from the market study:
- From 2019 to 2023, the data centre colocation market was valued at a CAGR of 12.6%
- Based on end-users, the large enterprises segment is expected to account for a share of 63.0% in 2024
- Global data centre colocation demand in China is predicted to account for a CAGR of 15.4% in 2024
- In the United States, the data centre colocation industry is expected to account for a CAGR of 12.7% in 2024
- Germany is projected to expand by a value CAGR of 14.4% between 2024 and 2034
- The data centre colocation market in Japan is anticipated to record a CAGR of 16.1% in 2024
“The growing digitalisation across industries and increased importance of advanced IT infrastructure is anticipated to drive the market growth during the forecast period,” says Sudip Saha, Managing Director and Co-Founder at Future Market Insights.
Key players focus on organic growth strategies like product launches and approval. Collaborations and partnerships with key players and acquiring niche players are critical strategies followed by leading players in the data centre colocation market.
Some of the developments in the data centre colocation market are:
- CyrusOne has expanded rapidly, particularly in the United States, providing colocation solutions to numerous enterprises. The company’s emphasis on customised solutions, hyperscale facilities, and energy-efficient data centres has influenced market trends.
- Cyxtera Technologies offers a suite of colocation, cyber security, and analytics services. The company’s integration of cyber security features within its colocation offerings has impacted the market by emphasising security as a critical aspect of colocation services.
These insights are based on a report on the Data Centre Colocation Market by Sudip Saha, Principal Consultant, Future Market Insights.