Data Center Solutions Market Opportunities and Strategies to 2033

This report describes and explains the data center solutions market and covers 2018-2023, termed the historic period and 2023-2028, 2033F termed the forecast period. The report evaluates the market across each region and for the major economies within each region.

The global data center solutions market reached a value of nearly $36.6 billion in 2023, having grown at a compound annual growth rate (CAGR) of 12.15% since 2018. The market is expected to grow from $36.6 billion in 2023 to $69.3 billion in 2028 at a rate of 13.60%. The market is then expected to grow at a CAGR of 14.10% from 2028 and reach $133.9 billion in 2033.

Growth in the historic period resulted from the rise in the adoption of remote working models, growing adoption of cloud computing technology, expansion of the e-commerce sector and the rise in the use of AI and machine learning. Factors that negatively affected growth in the historic period include security concerns associated with data centers.

Going forward, the increasing use of IoT devices, increasing digital transformation, rise in digital payment systems and fintech platforms, increasing adoption of 5G networks and the increasing number of edge data centers will drive the market. Factors that could hinder the growth of the data center solutions market in the future include the limited availability of skilled personnel and technical expertise.

The data center solutions market is segmented by type into enterprise data center, mid-size data center and large data center. The enterprise data center market was the largest segment of the data center solutions market segmented by type, accounting for 54.28% or $19.9 billion of the total in 2023. Going forward, the mid-size data center segment is expected to be the fastest growing segment in the data center solutions market segmented by type, at a CAGR of 14.55% during 2023-2028.

The data center solutions market is segmented by electrical solution into power distribution, power backup and cabin infrastructure. The power distribution market was the largest segment of the data center solutions market segmented by electrical solution, accounting for 45.69% or $16.7 billion of the total in 2023. Going forward, the power backup segment is expected to be the fastest growing segment in the data center solutions market segmented by electrical solution, at a CAGR of 14.21% during 2023-2028.

The data center solutions market is segmented by mechanical solution into air conditioning, cooling water circulation device, cooling towers and management system. The air conditioning market was the largest segment of the data center solutions market segmented by mechanical solution, accounting for 42.29% or $15.5 billion of the total in 2023. Going forward, the management system segment is expected to be the fastest growing segment in the data center solutions market segmented by mechanical solution, at a CAGR of 15.16% during 2023-2028.

The data center solutions market is segmented by vertical into banking, financial services and insurance (BFSI), telecommunication and information technology (IT), energy and healthcare and other verticals. The banking, financial services and insurance (BFSI) market was the largest segment of the data center solutions market segmented by vertical, accounting for 32.10% or $11.8 billion of the total in 2023. Going forward, the telecommunication and information technology (IT) segment is expected to be the fastest growing segment in the data center solutions market segmented by vertical, at a CAGR of 15.06% during 2023-2028.

North America was the largest region in the data center solutions market, accounting for 54.37% or $19.9 billion of the total in 2023. It was followed by Western Europe, Asia-Pacific and then the other regions. Going forward, the fastest-growing regions in the data center solutions market will be Asia-Pacific and Africa, where growth will be at CAGRs of 17.07% and 16.54% % respectively. These will be followed by the Middle East and South America, where the markets are expected to grow at CAGRs of 15.96% and 14.86% respectively.

The global data center solutions market is fairly fragmented, with a large number of players operating in the market. The top ten competitors in the market made up to 24.3% of the total market in 2023. The market fragmentation can be attributed to the presence of small players in different geographies. Equinix Inc. was the largest competitor with a 5.6% share of the market, followed by Digital Realty Inc. with 5.5%, NTT Group with 2.1%, Microsoft Corporation with 2%, Amazon.com, Inc. with 2%, Dell Technologies, Inc. with 1.6%, Alphabet Inc. (Google LLC) with 1.5%, Meta Platforms, Inc. with 1.5%, Iron Mountain Inc. with 1.4% and Johnson Controls International plc with 1.1%.

The top opportunities in the data center solutions market segmented by type will arise in the enterprise data center segment, which will gain $17.6 billion of global annual sales by 2028. The top opportunities in the data center solutions market segmented by electrical solution will arise in the power distribution segment, which will gain $14.8 billion of global annual sales by 2028. The top opportunities in the data center solutions market segmented by mechanical solution will arise in the air conditioning segment, which will gain $14.2 billion of global annual sales by 2028. The top opportunities in the data center solutions market segmented by vertical will arise in the telecommunication and information technology (IT) segment, which will gain $10.8 billion of global annual sales by 2028. The data center solutions market size will gain the most in the USA at $14.3 billion.

Market-trend-based strategies for the data center solutions market include revolutionizing data center deployment with modular solutions, developing new liquid cooling technologies for data centers, focus on eco-friendly data center designs and structural durability standards and innovative advancements in data center solutions to enhance disaster recovery and reduce costs.

Player-adopted strategies in the data center solutions market include focus on expanding business through new product launches, strategic partnerships and new solution developments.

To take advantage of the opportunities, the analyst recommends data center solutions companies to focus on modular data center solutions, focus on liquid cooling technologies, focus on sustainable data center solutions, focus on innovative disaster recovery solutions, focus on the mid-size data center segment, expand in emerging markets, continue to focus on developed markets, provide competitively priced offerings, continue to use B2B promotions, participate in trade shows and events and focus on targeting telecommunications and it end-users.