by Brianna Crandall — April 25, 2018 — Research firm Arizton’s recent market research report offers insight into market drivers and trends in the data center industry in the Americas, such as the types of services companies are looking for in a data center today. The data center market in the Americas is projected to grow from $8.49 billion in 2017 to $11.71 billion by 2023, at a compound annual growth rate (CAGR) of 5.51%.
Data centers are the backbone of business and consumer internet operations, and the growth in the market is aided by increased internet penetration by consumers for personal and business purposes through smartphones and high-speed broadband networks. The proliferation of new technologies such as cloud-based services, Internet of Things (IoT), and big data analytics will boost the need for operations and the need for other services in the industry.
The report segments the market by infrastructure (electrical, mechanical, and general construction); by electrical infrastructure (UPS, rack PDU, generators, and others); by mechanical infrastructure (cooling, rack, and others); by general construction (building design, installation services, building development, security, and DCIM); by tier standards (tier 1 and tier 2, tier 3, and tier 4), and by geography (North America and Latin America).
The three leading drivers and trends of the data center industry in the Americas are discussed below.
Growing customer base for colocation providers and managed service providers
According to the report, the growing demand for colocation and managed services is driving the data center market in the Americas. Prominent vendors in the industry offer colocation, managed services, interconnection, and cloud connectivity solutions to occupy a large consumer base. In recent years, various colocation providers have announced cloud-connectivity services to major cloud platforms such as AWS, Microsoft, Google, Oracle, and IBM.
The construction of colocations and modular data centers is expected to transform the global market over the next few years. The integration of efficient cooling infrastructure, procurement of renewable power for operations, installation of racks with high power density, and cloud connectivity are some of the major factors propelling growth.
The US has more than 1,200 operational colocation data centers and around 300 service providers. Equinix, Digital Realty and DuPont Fabros Technology, Switch, CyrusOne, RangingWire (NTT), CoreSite, T5 Data Centers, and TierPoint are the leading colocation vendors in the US market.
Operators are focusing on tapping edge market opportunities, providing higher bandwidth, and retention of existing customer base through the development of colocation projects in the global market.
Facilities to adopt automation and monitoring solutions
According to the report, the increase in power consumption and dynamic control management over infrastructure operations is leading to the adoption of end-to-end monitoring of facilities in the data center market. In 2016, Google implemented DeepMind AI (artificial intelligence) or end-to-end monitoring and automation of its facilities. This has resulted in 15% savings in its cooling cost and around 40% savings over the cooling consumption by cooling systems.
The growing need for data center infrastructure management (DCIM) solutions, which is the marriage of information technology (IT) and data center facilities management (FM) disciplines, will help automate and monitor facilities in the global market. Data center automation identifies the maintenance of infrastructure to avoid operational failure. Leading vendors such as Schneider Electric’s StruxureWare, Vertiv’s Trellis, and ABB’s Ability offer automation platforms in global data center market. Canada and Latin American countries are also identifying the potential benefit of using DCIM systems to monitor and automate their facilities.
Modular infrastructure for faster data center deployment
The rise in the number of modular infrastructure data centers is driving the growth in the data center market in the Americas. Colocation providers are developing large facilities and deployment assets on an on-demand basis, such as creating a new data hall to meet dynamic demands from a large consumer base.
Vendors are also focusing on offering modular solutions that include pre-fabricated data center facilities, racks, and containment systems to develop a large market share. The method of leasing space from other service providers will help business owners to reduce around 30% of the operating expenses (OPEX) cost. Additional features and lost cost of maintenance will boost the demand for data centers in the American market during the forecast period.
Use of lithium-ion batteries and fuel cells in data centers
According to the report, the growing demand for efficient power systems and low-cost batteries will encourage vendors to introduce the use of lithium-ion batteries and fuel cells in data centers across the region. Modular uninterruptible power supply (UPS) systems are designed in an innovative manner so that they occupy less space in facilities and reduce the OPEX charges for business owners.
The introduction of lithium-ion batteries and fuel cells that are hydrogen-powered will promote the concept of green data centers and reduce environmental pollution. For instance, Daimler and HPE partnered for research in the use of automotive fuel cells powered by hydrogen and oxygen in data centers in 2017.
Leading vendors in the data center market in the Americas are: ABB, Eaton, General Electric, Schneider Electric, Vertiv, Turner Construction, Holder Construction, DPR Construction, Jacobs Engineering Group, Corgan, AECOM, Syska Hennessy Group, Aceco TI S.A, Equinix, Digital Realty and DuPont Fabros Technology, CyrusOne, Facebook, Switch and Ascenty.
The report offers a detailed study of major trends, drivers, and challenges, and provides the market size and forecast for major geographical regions and key countries.
The complete overview of the Data Center Market in Americas — Industry Outlook and Forecast 2018-2023 is now available for purchase from Arizton, or a Sample Report is available upon request.
A related report, Data Center Construction Market in Americas — Industry Outlook and Forecast 2018-2023, is also available.