The global data center construction market provides support infrastructure for data storage, management, computation, networking communication, and security. It helps companies to build or expand data centers for managing their digital assets and supporting new technologies like cloud computing, big data analytics, Internet of Things (IoT), and edge computing. Data centers consist of electrical and mechanical equipment like servers, storage, networking equipment and devices, physical security systems and various cabling infrastructures. With the growing dependence on digital technologies across industries, the demand for scalable and reliable IT infrastructure has increased considerably. The proliferation of cloud-based applications and services along with an exponential rise in digital data worldwide is fueling the need for advanced data center facilities.
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.
Increased cloud adoption among organizations for storage, computation and collaboration needs along with growing mobile subscriber base is driving substantial investments in data center construction projects. Cloud providers like Amazon Web Services, Microsoft Azure, Google Cloud, IBM Cloud, and Alibaba Cloud are rapidly building new data center regions and expanding their existing infrastructure footprint to accommodate growing business demands.
Market Dynamics:
Increased cloud adoption and demand for scalable IT infrastructure are the major factors spurring investments in data center construction activities. As mentioned earlier, the proliferation of cloud-based applications and platforms has led to huge amounts of digital data generation worldwide. This has increased the dependency of organizations on cloud and colocation services for storage, safety, computing and sharing of critical business data and applications. In order to support the delivery of advanced cloud-based offerings and provide agile, resilient and highly connected infrastructure to clients, cloud giants are increasingly focusing on expanding their data center network globally. For example, in February 2022 Amazon Web Services announced plans to set up data center regions in Tel Aviv, Israel and Melbourne, Australia to augment its cloud infrastructure portfolio. This rising impetus from cloud providers is driving the data center construction market.
Additionally, the ongoing trend of digital transformation across industries is generating massive amounts of data from various sources including connected devices, sensors, smart systems etc. Analysis of this data holds immense potential for unlocking valuable business insights. However, traditional on-premise IT infrastructure is unable to scale dynamically to store, manage and analyze such exponential data volumes. This has augmented the need among organizations to leverage scalable and elastic cloud infrastructure through colocation.
Segment Analysis
Data center construction market is segmented on the basis of electrical infrastructure, mechanical infrastructure and general construction. General construction is the dominating segment accounting for around 35% share in the market. This is because general construction involves major activities like civil, structural and architectural works which form a major part of overall construction costs.
PEST Analysis
Political: Data protection laws introduced by various governments impact data center construction.favorable FDI policies facilitate new investments.
Economic: Growing digitalization, cloud adoption and data traffic drives investments in data center infrastructure. Higher GDP growth increases IT spending.
Social: Increasing internet penetration, mobile users and digital services fuel demand for data storage facilities. Demographic shifts influence location of new data centers.
Technological: Adoption of modular, automation, AI/ML and green technologies in design and operations helps achieve efficiency and sustainability goals. Emerging technologies require additional infrastructure investments.
Key Takeaways
The Global Data Center Construction Market Growth is expected to witness high. 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 comprises North America dominates currently due to strong financial resources of leading cloud providers and hyperscalers. The industry is expected to grow fastest in the APAC region on account of rapid digital transformation, government initiatives for smart city projects and increasing foreign investments.
Key players operating in the data center construction market are Regeneron Pharmaceuticals, Inc., Alimera Sciences, Oxurion NV., Abbvie Inc. and F. Hoffmann-La Roche Ltd. Regeneron Pharmaceuticals is a leading player with strong R&D capabilities and market reach. Alimera Sciences holds significant market share for its sustained release implants for treating diabetic retinopathy. Oxurion NV focuses on developing innovative treatments through its Trulock and small molecule candidates. Abbvie Inc. markets several drugs indicated for managing diabetes and its complications globally. F. Hoffmann-La Roche Ltd offers extensive diagnostic tests and therapeutics through continuous innovations.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
