April 20, 2024
Data Center Construction Market

The Increasing Adoption Of Cloud Computing Is Driving The Data Center Construction Market

The growing reliance on cloud technologies for effective data storage and seamless connectivity across various industry verticals has been driving significant investments toward the development of scalable and efficient data center facilities. Data centers have evolved to incorporate next-generation architecture and equipment to support the deployment of large-scale cloud environments. The demand for hyperscale data centers equipped with high-density servers, networking infrastructure and energy-efficient cooling systems has increased considerably in recent years. Moreover, the adoption of artificial intelligence, big data analytics and edge computing across various end-use industries is prompting enterprises to enhance their on-premises and off-premises data center capabilities.

The global Data Center Construction Market is estimated to be valued at US$ 72099.62 Mn in 2024 and is expected to exhibit a CAGR of 6.4% over the forecast period 2024 to 2031, as highlighted in a new report published by Coherent Market Insights.

Data centers are facilities that house computer systems and associated components, such as telecommunications and storage systems. They are explicitly designed to meet the requirements of businesses, government agencies, and other organizations regarding data management and storage with high level of security. As the usage of digital devices such as smartphones, tablets and laptops continues to grow among individuals and enterprises, the demand for storing, processing and managing this huge amount of data is also rising rapidly. Data centers play a crucial role in processing and storing enormous amounts of data and also enable centralized management of physical and virtual resources. This reduces downtime, improves efficiency and offers scalability benefits to end users. However, the development of such facilities requires huge capital investments and complex infrastructure.

Market key trends:

One of the major trends in the data center construction market is increased focus on edge infrastructure and micro data centers. Edge infrastructure refers to distributed data center facilities and edge nodes located in proximity to end-users to provide lower latencies. As emerging technologies such as artificial intelligence, augmented reality and Internet-of-Things generate huge amount of data locally, there is a growing need to process and analyze this data in real-time. Edge infrastructure and micro data centers aim to address this challenge by enabling localized data processing and storage capabilities close to the source of data generation. Several big cloud and data center companies are collaborating with telecom operators to develop edge nodes within telecom networks. This trend is expected to accelerate over the forecast period with widespread 5G adoption.

Porter’s Analysis

Threat of new entrants: Low entry barrier for small construction firms poses moderate threat. However, large construction requires high initial investments.
Bargaining power of buyers: Large data center operators have significant bargaining power due to bulk purchasing. Small cloud service providers have low bargaining power.
Bargaining power of suppliers: Few specialized equipment suppliers results in moderate bargaining power. However, availability of material substitutes balance this power.
Threat of new substitutes: Edge computing poses threats but cannot replace core data centers yet due to data gravity and regulations. Hybrid infrastructure is a growing trend.
Competitive rivalry: Intense competition to gain large contracts. Players differ based on expertise, technology focus and geographic reach.

Key Takeaways

The Global Data Center Construction Market Demand is expected to witness high growth. The global Data Center Construction Market is estimated to be valued at US$ 72099.62 Mn in 2024 and is expected to exhibit a CAGR of 6.4% over the forecast period 2024 to 2031.

Regional analysis: North America dominates with over 30% market share owing to growing hyperscale developments and support for high-performance computing. APAC is experiencing rapid growth led by China, India & Australia. Europe and MEA are other major regions benefiting from investments in connectivity and cloud infrastructure.

Key players: Regeneron Pharmaceuticals, Inc., Alimera Sciences, Oxurion NV., Abbvie Inc. and F. Hoffmann-La Roche Ltd are the major companies operating in the Global Diabetic Retinopathy Market. These leading players are focusing on partnerships, new product launches, and Regional expansions to increase their market share in the diabetic retinopathy market.

*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it