The Global Modular Data Center Market size is expected to reach $78.43 billion by 2031, rising at a market growth of 17.0% CAGR during the forecast period.
The North America segment recorded 39% revenue share in the market in 2023. The North America segment is driven by the region's strong focus on technological advancements, including widespread adoption of cloud computing, AI, and IoT solutions. The presence of major tech companies, coupled with significant investments in IT infrastructure, has heightened the demand for these data centers to support growing data processing and storage needs.
The major strategies followed by the market participants are Product Launches as the key developmental strategy to keep pace with the changing demands of end users. For instance, In March, 2024, Eaton Corporation plc has launched its SmartRack modular data centers in North America, designed for rapid deployment in edge computing, AI, and machine learning environments. The solution combines IT racks, cooling, and service enclosures, providing customizable, performance-optimized data centers that can be deployed quickly, reducing costs and development time. Moreover, In November, 2024, Delta Electronics, Inc. has launched the SMART PDU I-Type, a compact 1U DC distribution unit with up to 21 intelligent, programmable breakers and remote management. It optimizes power distribution, enhances operational efficiency, saves space, and reduces costs for telecom and data center operators. Its design supports scalable, energy-efficient infrastructure for growing 5G and data needs.
Additionally, Organizations grapple with increasing data demands as digital transformation accelerates worldwide, necessitating robust and scalable infrastructure to ensure efficiency and reliability. With over 68% of the global population now connected to the internet as of 2024, up from 53% in 2019, the volume of data generated and transmitted has grown exponentially. The number of internet users globally is projected to surpass 6 billion in the coming years, putting immense pressure on traditional data center infrastructure. Therefore, this global shift towards digitalization, combined with the relentless expansion of IT and telecommunications industries, ensures that these data centers remain at the forefront of the infrastructure revolution.
The leading players in the market are competing with diverse innovative offerings to remain competitive in the market. The above illustration shows the percentage of revenue shared by some of the leading companies in the market. The leading players of the market are adopting various strategies in order to cater demand coming from the different industries. The key developmental strategies in the market are Product Launches and Product Expansions.
The competition in the Modular Data Center Market is marked by a mix of emerging and regional firms focusing on niche innovations and cost-effective solutions. These players leverage customization, energy efficiency, and rapid deployment to compete. Collaboration with local enterprises and targeting underserved markets are common strategies, intensifying competition in this dynamic and rapidly evolving sector.
The North America segment recorded 39% revenue share in the market in 2023. The North America segment is driven by the region's strong focus on technological advancements, including widespread adoption of cloud computing, AI, and IoT solutions. The presence of major tech companies, coupled with significant investments in IT infrastructure, has heightened the demand for these data centers to support growing data processing and storage needs.
The major strategies followed by the market participants are Product Launches as the key developmental strategy to keep pace with the changing demands of end users. For instance, In March, 2024, Eaton Corporation plc has launched its SmartRack modular data centers in North America, designed for rapid deployment in edge computing, AI, and machine learning environments. The solution combines IT racks, cooling, and service enclosures, providing customizable, performance-optimized data centers that can be deployed quickly, reducing costs and development time. Moreover, In November, 2024, Delta Electronics, Inc. has launched the SMART PDU I-Type, a compact 1U DC distribution unit with up to 21 intelligent, programmable breakers and remote management. It optimizes power distribution, enhances operational efficiency, saves space, and reduces costs for telecom and data center operators. Its design supports scalable, energy-efficient infrastructure for growing 5G and data needs.
KBV Cardinal Matrix - Market Competition Analysis
Based on the Analysis presented in the KBV Cardinal matrix; Huawei Technologies Co., Ltd. is the forerunner in the Modular Data Center Market. In May, 2024, Huawei Technologies Co., Ltd. unveiled global flagship service centers. These centers aim to enhance data center reliability through lifecycle services, including construction, operation, and maintenance. Huawei’s global network ensures 24/7 support, rapid responses, and optimized data center performance. Companies such as ABB Group, Schneider Electric SE, and Eaton Corporation plc are some of the key innovators in Modular Data Center Market.
Market Growth Factors
In today’s fast-evolving technological landscape, organizations prioritize the scalability and flexibility of their IT infrastructure to adapt quickly to changing business needs. These data centers have emerged as a preferred solution for businesses seeking to efficiently manage fluctuating data demands. Unlike traditional data centers, modular solutions are designed with scalability at their core, allowing organizations to expand or reduce their infrastructure capacity based on workload requirements without overhauling existing systems. Hence, as enterprises continue to embrace digital transformation, the scalability and flexibility provided by these data centers remain critical in enabling them to stay agile and competitive in a dynamic market.Additionally, Organizations grapple with increasing data demands as digital transformation accelerates worldwide, necessitating robust and scalable infrastructure to ensure efficiency and reliability. With over 68% of the global population now connected to the internet as of 2024, up from 53% in 2019, the volume of data generated and transmitted has grown exponentially. The number of internet users globally is projected to surpass 6 billion in the coming years, putting immense pressure on traditional data center infrastructure. Therefore, this global shift towards digitalization, combined with the relentless expansion of IT and telecommunications industries, ensures that these data centers remain at the forefront of the infrastructure revolution.
Market Restraining Factors
However, these data centers are typically built with standardized, predefined modules that cater to common use cases. While this approach simplifies deployment and reduces costs, it may not meet the unique requirements of certain industries or enterprises. For instance, organizations in sectors that are highly regulated, such as healthcare or financial services, frequently require customized solutions to adhere to stringent regulations or to satisfy specific operational requirements. Hence, these challenges may drive enterprises to favor traditional solutions over modular options.
The leading players in the market are competing with diverse innovative offerings to remain competitive in the market. The above illustration shows the percentage of revenue shared by some of the leading companies in the market. The leading players of the market are adopting various strategies in order to cater demand coming from the different industries. The key developmental strategies in the market are Product Launches and Product Expansions.
Driving and Restraining Factors
Drivers
- Growing Demand For Scalable And Flexible IT Infrastructure
- Rapidly Expanding IT And Telecom Sectors
- Rapid Expansion Of Edge Computing
Restraints
- Limited Customization And Scalability Options
- More Dependence On Skilled Workforce
Opportunities
- Increased Data Traffic And Cloud Adoption
- Rising Focus On Disaster Recovery
Challenges
- Substantial High Initial Investment Costs
- Complexity In Integration With Existing Infrastructure
Component Outlook
Based on component, the market is bifurcated into solutions and services. The services segment procured 25% revenue share in the market in 2023. The services segment is propelled by the growing need for professional assistance deploying, managing, and maintaining these data center systems. Enterprises seek expert consulting, integration, and support services to ensure seamless operations and maximize the return on investment.Organization Size Outlook
On the basis of organization size, the market is classified into large enterprises and small & medium enterprises. The small & medium enterprises segment witnessed 37% revenue share in the market in 2023. The small & medium enterprises (SMEs) segment thrives on the growing demand for affordable and flexible modular data center solutions. SMEs often face budget constraints and require compact systems that can be deployed quickly to accommodate their expanding IT needs.
Industry Vertical Outlook
By industry vertical, the market is divided into IT & telecom, BFSI, healthcare, government & defense, media & entertainment, retail, and others. The BFSI segment procured 16% revenue share in the market in 2023. The BFSI sector is thriving due to the growing demand for secure, reliable, and scalable data center solutions to manage sensitive customer data and critical financial operations. These data centers provide a perfect fit by offering advanced security features, efficient disaster recovery options, and the flexibility to scale with rising data demands.Market Competition and Attributes
The competition in the Modular Data Center Market is marked by a mix of emerging and regional firms focusing on niche innovations and cost-effective solutions. These players leverage customization, energy efficiency, and rapid deployment to compete. Collaboration with local enterprises and targeting underserved markets are common strategies, intensifying competition in this dynamic and rapidly evolving sector.
Regional Outlook
Region-wise, the market is analyzed across North America, Europe, Asia Pacific, and LAMEA. The Europe segment witnessed 29% revenue share in the market in 2023. The Europe segment thrives on the increasing emphasis on digital transformation and the need for data centers that comply with stringent regulations like GDPR. The region's growing adoption of edge computing, renewable energy integration, and green data center initiatives is fueling demand for scalable and energy-efficient modular data centers.Recent Strategies Deployed in the Market
- Jul-2024: Vertiv Group Corp. has launched MegaMod CoolChip, a liquid-cooled prefabricated modular data center solution designed for AI computing. It integrates Vertiv CoolChip technology for direct-to-chip cooling, power distribution, and other infrastructure needs. This solution reduces AI infrastructure deployment time by up to 50%, offering scalable, efficient, and reliable capacity.
- Jun-2024: Schneider Electric SE has opened a 105,000-square-foot integration facility in Red Oak, Texas, to meet the rising demand for data centers. The facility will produce prefabricated IT infrastructure, creating over 200 jobs. This move supports Schneider’s partnership with Compass Datacenters, accelerating delivery and efficiency in the data center sector.
- Jun-2024: Vertiv Group Corp. announced the partnership with Ballard Power Systems to demonstrate a hydrogen-powered fuel cell backup solution for data centers, scalable from 200kW to multiple MWs. The proof of concept, combining Ballard’s fuel cells with Vertiv’s UPS system, offers zero-emission, cost-effective, and scalable power for data center sustainability and growth.
- Jun-2024: Hewlett Packard Enterprise Company teamed up with Danfoss to offer HPE IT Sustainability Services - Data Center Heat Recovery. This solution captures excess heat from data centers for reuse, enhancing energy efficiency. HPE’s modular data centers reduce energy use by 20%, while Danfoss' technologies improve cooling and heating efficiency.
- Feb-2024: Schneider Electric SE teamed up with NTT Data, an IT company, to launch a groundbreaking solution integrating edge computing, private 5G, IoT, and modular data centers. This offering aimed to enhance connectivity and efficiency for compute-intensive tasks like AI and IoT, addressing the need for high-performance, low-latency data processing at the edge.
List of Key Companies Profiled
- ABB Group
- Schneider Electric SE
- Eaton Corporation plc
- Huawei Technologies Co., Ltd. (Huawei Investment & Holding Co., Ltd.)
- Johnson Controls International PLC
- Delta Electronics, Inc.
- Altron a.s.
- Vertiv Group Corp.
- Hubbell Incorporated
- Hewlett Packard Enterprise Company
Market Report Segmentation
By Component
- Solutions
- All-in-one Modules
- Individual Modules
- IT Modules
- Power
- Cooling
- Services
- Integration & Deployment
- Design & Consulting
- Maintenance & support
By Organization Size
- Large Enterprises
- Small & Medium Enterprises
By Industry Vertical
- IT & Telecom
- BFSI
- Healthcare
- Government & Defense
- Media & Entertainment
- Retail
- Other Industry Vertical
By Geography
- North America
- US
- Canada
- Mexico
- Rest of North America
- Europe
- Germany
- UK
- France
- Russia
- Spain
- Italy
- Rest of Europe
- Asia Pacific
- China
- Japan
- India
- South Korea
- Singapore
- Malaysia
- Rest of Asia Pacific
- LAMEA
- Brazil
- Argentina
- UAE
- Saudi Arabia
- South Africa
- Nigeria
- Rest of LAMEA
Table of Contents
Chapter 1. Market Scope & Methodology
Chapter 2. Market at a Glance
Chapter 3. Market Overview
Chapter 4. Competition Analysis - Global
Chapter 5. Global Modular Data Center Market by Component
Chapter 6. Global Modular Data Center Market by Organization Size
Chapter 7. Global Modular Data Center Market by Industry Vertical
Chapter 8. Global Modular Data Center Market by Region
Chapter 9. Company Profiles
Companies Mentioned
- ABB Group
- Schneider Electric SE
- Eaton Corporation plc
- Huawei Technologies Co., Ltd. (Huawei Investment & Holding Co., Ltd.)
- Johnson Controls International PLC
- Delta Electronics, Inc.
- Altron a.s.
- Vertiv Group Corp.
- Hubbell Incorporated
- Hewlett Packard Enterprise Company
Methodology
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