North America Containerized Data Center - Market Share Analysis, Industry Trends & Statistics, Growth Forecasts 2019 - 2029

The North America Containerized Data Center Market size is estimated at USD 5.55 billion in 2024, and is expected to reach USD 16.23 billion by 2029, growing at a CAGR of 23.91% during the forecast period (2024-2029).

Key Highlights

• With the growing adoption of the cloud and increasing data generation, the demand for containerized data centers in the region has spiked drastically over the past few years. These data centers are fabricated in a manufacturing facility and shipped to the end user in the container. Most of the components in this type of data center are preinstalled and offer limited flexibility in replacing and upgrading components.
• Containerized data center solution units facilitate the physical IT infrastructure. The modular approach can focus on the data center or a more granular level. For instance, more granular approaches can go down to the rack level. As the market for x86-based servers, storage, and network equipment has grown, end users across a broad spectrum of vertical markets have been exploring ways to find more effective methods of installing and managing data center equipment.
• Moreover, big data and Internet of Things (IoT) penetration in the region is expected to significantly transform the size and scope of the next-generation modular data centers. With the existing competition, organizations are under pressure to evolve IT scalability and capacity. With the exponential growth of data, hybrid cloud, and outsourcing third-party data centers, containerized data centers are gaining traction, owing to their flexibility in installing a center within the least possible time.
• Further, rising digitization throughout the industrial emphasis areas, steady technological advancements, and rising penetration of smart connected devices have all contributed to the growth of IoT in the North American region.
• Organizations are looking at modular services to optimize their infrastructure by selecting the desired services from the available integrated portfolio. In addition, with the standardized delivery deployment, several service options are made available from online catalogs. These options offer the ability to lower the upfront investment for companies. IBM integrated managed infrastructure service is an example of this situation.
• However, higher initial investments and low resource availability are some factors presenting challenges to this market. Further, these data centers are containerized; they are in small sizes and can be moved from one place to another. As a result of this, they have limited computing efficiency.
• During the COVID-19 lockdown, the demand for data centers grew as more people started working remotely. Increased data traffic impacted the market studied due to the expanding use of cloud services.

North America Containerized Data Center Market Trends

Government Sector Expected to Witness Significant Growth

• Government agencies are also broadly adopting containerized data centers to bolster security. The sensitive data, such as employees' social security numbers, addresses of service members, and citizens' information, are stored in modular data centers operated by AI systems for an additional layer of protection.
• Government initiatives and the digitalization of public accessibility platforms are the greatest sources of demand for containerized data centers worldwide. This is increasing the demand for modular data centers.
• For instance, in September 2022, the US Department of Energy announced that it is providing USD 42 million in funding for initiatives to lower the energy consumed for cooling in data centers and reach net zero carbon dioxide emissions by 2050.
• Moreover, in February 2023, Amazon Web Services (AWS) pitched a modular data center (MDC) to the US government to make it easier to deploy makeshift bit barns managed by AWS in remote locations. AWS MDC is a self-contained modular data center unit for US Department of Defense (DoD) agencies, which can scale by deploying additional units. Each is housed inside a ruggedized shipping container for freight transportation via ship, rail, truck, or even air transport using military cargo aircraft.
• Considering the Canadian environment, the Government of Canada (GC), by its "cloud-first" strategy, outlined that cloud services are identified and evaluated as the principal delivery option when initiating information technology (IT) investments, initiatives, strategies, and projects.

United States Expected to Witness Significant Growth

• Enterprises in the North American region have started to view hyper-convergence as a viable alternative to the traditional data center. It combines storage, networking, and computing into a single system, reducing data center complexity and increasing scalability. As a result, an increase in adopting a hyper-converged infrastructure platform is driving the containerized data center market.
• According to a report by Coldwell Banker Richard Ellis (CBRE), the total capacity of the US primary data center markets grew by 352.9 megawatts (MW) or 10.5% in H1 2022. The country is expanding its capacity by more than 1600 MW, currently under construction. As a result, the primary US wholesale data center market recorded a combined 453.4 MW of net absorption in H1 2022, more than triple H1 2021's level and almost 60% of it in Northern Virginia.
• The development of edge data centers attributes solely to containerized data centers, as it tends to meet an organization's new-age demands. Moreover, it is highly adopted due to its portable format, quick to install, scalable, and equipped with server functionality at a given point in time, regardless of location. Therefore, market players are observed to manufacture servers compatible with containerized data centers.
• In September 2022, Subsea Cloud, the company proposing to put commercial data centers in deep ocean waters, announced its plan to install a pod near Port Angeles, Washington State. The pod will start with a 6m (20ft) shipping container around nine meters underwater, holding 800 servers, eventually scaling to 100 such pods.
• Moreover, the region has a strong foothold of modular data center providers, which adds to its growth. Some include IBM Corporation, HPE, Vertiv Co., Cisco Systems, and Dell EMC.
• For instance, Google announced its plan to invest USD 9.5 billion in new offices and data centers in the US by the end of 2022. Moreover, Google has spent over USD 37 billion on its offices and data centers across 26 US states. Such significant investments by the key players in the region are expected to boost the development of containerized data centers.

North America Containerized Data Center Industry Overview

The North America containerized data center market includes major players such as IBM Corporation, Hewlett Packard Enterprise, Dell Inc., Cisco Systems Inc., Rittal GmbH & Co. KG, and Huawei Technologies Co. Ltd, among others. These players are undertaking mergers and acquisitions and product launches to develop and introduce new technologies and products to the market. As a result of this, market concentration will be medium.

In October 2022, IBM announced it would add Red Hat storage product roadmaps and Red Hat associate teams to the IBM Storage business unit, bringing consistent application and data storage across on-premises infrastructure and cloud. With the move, IBM will integrate the Red Hat OpenShift Data Foundation (ODF) storage technologies as the foundation for IBM Spectrum Fusion. This combines IBM and Red Hat's container storage technologies for data services and helps accelerate IBM's capabilities in the burgeoning Kubernetes platform market.

Moreover, in October 2022, Oracle announced the launch of new services to simplify management, security, and development in the cloud, including a managed serverless Kubernetes service for customers who want to build containerized applications without having to manage the Kubernetes infrastructure.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support

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