Switzerland Data Center - Market Share Analysis, Industry Trends & Statistics, Growth Forecasts (2024 - 2029)

The Switzerland Data Center Market size is estimated at 534.8 MW in 2024, and is expected to reach 676.2 MW by 2029, growing at a CAGR of 4.80%. Further, the market is expected to generate colocation revenue of USD 1.70 billion in 2024 and is projected to reach USD 2.36 billion by 2029, growing at a CAGR of 6.77% during the forecast period (2024-2029).

Tier 3 data center accounted for majority share in terms of volume in 2023, and is expected to dominate through out the forecasted period

• The Tier 3 segment of the market had the largest market share of 81.5%, with an IT load capacity of 371 MW in 2022. It is further projected to exhibit a CAGR of 1.9%, surpassing 435.49 MW by 2029. On the other hand, tier 4 data centers are expected to gain traction with a projected CAGR of 15.49% to reach a capacity of 226 MW by 2029.
• Tier 1&2 segments already have an adequate supply of retail colocation and large-scale builds to cater to the increasing hyperscale cloud requirements, which are driving the demand as the need for lower latency and more efficiency is growing.
• Facilities in Tier 1 and Tier 2 data centers gradually lose their demand and display a decrease in growth in the upcoming years. Tier 1&2 facilities are expected to hold a market share of nearly 1.6% by 2029 with minimal growth. This is a result of the prolonged and inconsistent outages. Most users eventually switch to Tier 3 and Tier 4 facilities, holding 62.4% and 36% of market shares, respectively, owing to the increased demand for storing, processing, and analyzing data.
• The fintech sector of the economy is expanding. In 2018, SIX, which is the main infrastructure provider for the Swiss financial market, plans cloud for banking in Switzerland.
• Tier 4 data centers are expected to expand significantly in the years to come due to the fact that more businesses are providing cloud-based services, which caused more businesses to construct facilities to provide colocation space with the best technology. For instance, cloud expenditure in Switzerland was already CHF 4.93 billion in 2021, and only 5% of companies adopted cloud services by 2022.

Switzerland Data Center Market Trends

Increasing consumption of data in social media usage, video-on-demand and online gaming drives the demand for market

• The total data traffic per smartphone in the country is expected to witness a CAGR of 9.6% during the forecast period to reach a value of 44.5 GB by 2029. The consumption of data by multiple end users motivates this trend. For instance, as of 2021, in Switzerland, time spent on the internet was 3.6 hours per day by young people, and the average time spent on smartphones was 2 hours and 29 minutes per day. Considering the above factors, such as an increase in data consumption, time spent on smartphones, and growth of digitalization across all end users, leads to the rise of data traffic per smartphone.
• The growing average data volume due to rising OTT subscription numbers for smartphones and mobile gaming is further driving the demand for data processing and storage facilities for the live streaming of games and video content. In 2020, 42% of Swiss consumers accessed pay-per-view video-on-demand services like Netflix, Swisscom TV, and Amazon Prime. This represented an increase of 33% over the prior year, 2019.
• The mobile games business has tremendous growth potential in the coming year, despite already being the largest video game segment. The mobile gaming phenomenon Pokémon Go, games like Harry Potter: Wizards Unite, and Nintendo's expanding support for mobile games are key growth drivers for the industry. Additionally, the expansion of the market is greatly influenced by the mobile versions of the well-known online games Fortnite and PUBG. Thus, the needs of the end users are changing, and the demand for more data storage contributes to the growth of the data center market in Switzerland.

Rising smartphone ownership and increase in number of app downloads boost the market growth

• The total number of smartphone users in the country is expected to witness a CAGR of 1.6% during the forecast period to reach a value of 9 million by 2029. Digital usage is expanding rapidly in Switzerland. Consumer behavior has been impacted by the quick adoption of the internet and smartphone technology in various businesses. For instance, purchasing power parity (PPP) increased from USD 68.8 thousand in 2016 to USD 71 thousand in 2021. As a result, more people can purchase smartphones, which results in a growing number of smartphone users.
• The internet penetration of the country increased from 89% in 2016 to 96% in 2021, while at the same time, the number of smartphone users increased from 6.9 million in 2016 to 7.9 million in 2021. Owing to such extensive use, digital payment services were promoted, and their application increased due to the COVID-19 pandemic.
• Due to its high GDP and location between France, Italy, and Germany, Switzerland has a significant market for luxury goods and a high demand for cross-border e-commerce. Cash is still common, while cards are frequently used in Switzerland. Invoices are famous for e-commerce payments, while TWINT is a new and increasingly popular local payment method with 3 million users. Used for both e-commerce and at the point of sale, TWINT combines mobile payments with QR technology, which is predicted to have a long-term impact on the market. The rising use of smartphones in the Swiss market results in a constant increase in data, necessitating an increase in storage space and data centers must manage the sheer amount of data. Thus, the requirement for racks in Swiss data centers may increase as the number of smartphone users rises.

Switzerland Data Center Industry Overview

The Switzerland Data Center Market is fragmented, with the top five companies occupying 32.49%. The major players in this market are Equinix Inc., EXA Infrastructure, Green Datacenter, Interxion (Digital Reality Trust Inc.) and NTT Ltd (sorted alphabetically).

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