Published Date: 2020-11-18
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According to the Graphical Research new growth forecast report titled North America Data Center Colocation Market value is set to be over USD 45 billion by 2026. Colocation data center providers offer unique scalability features with increased control to customers. Players are partnering with hardware vendors to offer turnkey solutions to their clients. For instance, in March 2018, Equinix, Inc. partnered with Intel Corporation to launch Equinix SmartKey, an encryption SaaS for enhancing data protection across cloud & data centers. The company implemented the solution in over 190 International Business Exchange (IBX) data centers in around 47 locations to securely host encryption keys. The improved flexibility with solutions, such as data warehousing and data analytics, is encouraging enterprises to invest in colocation facilities.
Colocation data centers are witnessing high demand from internet providers due to the rising adoption of online services, such as digital games, e-learning, and streaming media, on multiple devices amid the COVID-19 pandemic. According to the Media Technology Monitor (MTM), in Canada, the number of users subscribing Over The Top (OTT) services has grown by 58% during the COVID-19 pandemic. This drives the need for additional equipment & resources in dedicated data centers, resulting in increasing capital expenditure for enterprises. Colocation providers offer an affordable and convenient solution for companies to scale and grow their business at a low cost.
Wholesale colocation services are witnessing growth in data center colocation market due to increasing demand for large-scale clouds, secure space, and powerful data centers among large enterprises. These data centers are becoming popular among hyper-scale customers as they offer higher bandwidth, mitigation of service interruptions, strategic colocation, and reduced total cost of ownership. Wholesale colocation data centers include advanced power and cooling infrastructure to meet the demand for high server densities in the industry. For instance, H5 Data Centers, LLC includes security, dual authentication devices, and surveillance cameras in its wholesale data center offering.
The growing concern of high cost and scalability in small & medium enterprises is driving the adoption of colocation data centers. The power required to run servers and maintain the equipment at an optimal temperature constitutes the largest IT expense for most SMEs. Colocation facilities offer security, customer support, reliability uptime, and compliance management, enabling companies to scale their resources. Several colocation providers offer managed services, such as replacement of disk drives, software updating, and hosting services to their clients that significantly reduce capital expenditure for SMEs.
In the data center colocation market, the BFSI sector is witnessing increased adoption of colocation services. The sector has witnessed a significant transition with the adoption of emerging technologies such as AR/VR, blockchain, biometric, AI, and cloud. This leads to increasing challenges arising from storing and processing large volumes of data. Banks generate over 1.9 petabytes of data every day, which becomes inconvenient for in-house data centers. Mission-critical systems, bandwidth-hungry apps, and high-performance activities including digital transfers demand more capacity and throughput, leading to the rising demand for colocation services in the sector.
Key players operating in the market are CyrusOne, Cyxtera Technologies, Inc., Digital Realty, KDDI Corporation, Global Switch, Equinix, Inc Navisite, Inc., NTT Communications Corporation, Ltd., Rackspace, Inc., and Verizon Communications, Inc. Players adopt several strategies to build dedicated facilities to serve customers’ requirements. For instance, in January 2020, Vapor IO, Inc., an edge colocation and interconnection service provider, announced partnership with Cloudflare, Inc. to expand its edge infrastructure to 36 cities in the U.S. The company’s data center networks are in the pre-construction phase in 16 municipalities and will launch by the end of 2020, while remaining facilities will come online by 2021.
The North America data center colocation market research report includes in-depth coverage of the industry with estimates & forecast in terms of revenue in USD million from 2016 to 2026 for the following segments:
Market Share, By Type
Market Size, By End-use
Market Value, By Application
The above information is provided on a country basis for the following:
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