Hyperscale Data Center Market size is anticipated to surpass USD 1786.7 billion by the end of 2035, growing at a CAGR of 29.32% during the forecast period, i.e., 2023-2035. In the year 2022, the industry size of hyperscale data center was over USD 81.67 billion. The growth of the market can be attributed to the growing volume of digital businesses worldwide owing to augmenting investment in digital transformation together with the rising need for data centers to enhance productivity, reduce operational costs and increase customer experiences. For instance, as per estimations, the direct digital transformation investment is anticipated to hit nearly USD 7 trillion with a CAGR of 18% from 2020 to 2023 as companies have been strategizing & investing to become future enterprises that are digital at scale.
Furthermore, factors that are believed to fuel the market growth of hyperscale data centers include the unprecedented growth in storage demand, driven by the increasing amount of video-intensive content, collaboration, multi-generational investments, and many other digital transformation applications together with developing infrastructure that is scalable and can maintain a high level of security. For instance, Broadcom Inc., the market leader in hyperscale video storage connectivity, in October 2022 announced the expansion of its silicon, software, and hardware storage connectivity products with enhanced performance, capabilities, and power. This expanded product portfolio is intended to aid hyperscale data centers to manage and maintain the storage connectivity they need to deliver video storage at scale. Additionally, the growing demand for hyperscale data centers over enterprise data centers by large companies owing to its economies of scale and custom engineering is predicted to present the potential for market expansion over the projected period.
Growth Drivers
Challenges
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Base Year |
2022 |
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Forecast Year |
2023-2035 |
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CAGR |
~29.32% |
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Base Year Market Size (2022) |
~ USD 81.67 Billion |
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Forecast Year Market Size (2035) |
~ USD 1786.7 Billion |
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Regional Scope |
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User Type (Cloud, Colocation, Enterprise)
The global hyperscale data center market is segmented and analyzed for demand and supply by user type into cloud, colocation, and enterprise. Out of the three types of users hyperscale data centers, the cloud segment is estimated to gain the largest market share of about ~58% in the year 2035. The growth of the segment can be attributed to the rising growth in the field of cloud computing as it facilitates data backup, disaster recovery, software development and testing, big data analytics, and many other advantages to large and small enterprises worldwide. For instance, it was observed that cloud computing spending rose by ~35% year-over-year in 2021. The spending in 2020 was recorded to be around USD 140 billion whereas it reached around USD 191.5 billion in 2021. Moreover, over 50% of enterprises are expected to use industry cloud platforms to accelerate their business initiatives by 2027. Hence, all these factors are anticipated to boost the segment growth in the upcoming years.
Solution (Software, Storage, Server)
The global hyperscale data center market is also segmented and analyzed for demand and supply by solution into software, storage, and server. Amongst these three segments, the server segment is expected to garner a significant share of around ~46% in the year 2035, owing to the increasing focus placed by digital businesses on achieving optimized workload management with speed, agility, and security without having to deal with the challenges of training, integration and deployment, support, and maintenance. This, as a result, is anticipated to create numerous opportunities for the growth of the segment in the coming years.
Our in-depth analysis of the global market includes the following segments:
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By Solution |
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By User Type |
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By Industry |
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North American Market Forecast
The market share of hyperscale data centers in North America, amongst the market in all the other regions, is projected to be the largest with a share of about ~35% by the end of 2035. The growth of the market can be attributed majorly to the growing digitalization in the region as well as the strong existence of companies with the broadest data center footprint together with the increasing investment in advanced technologies in the North American region. It was found that over 50% of the world's hyperscale data centers were located in the U.S. in 2021. Moreover, the base of many large bid-data producing companies, including Microsoft, Amazon, Google, IBM, and Meta along with their expanding facilities of cloud provision is further expected to boost the market growth.
APAC Market Statistics
The Asia Pacific hyperscale data center market is estimated to be the second largest, registering a share of about ~24% by the end of 2035. The growth of the market can be attributed majorly to the growing base of big data-producing companies in the region together with the rising need to store, manage and process these vast volumes of data. As per research, it was found that in 2021, China was the next biggest contributor to hyperscale data center capacity after the US across the globe, and accounted for nearly 15% of the overall hyperscale data centers operated in that year.
Europe Market Forecast
Further, the market in Europe, amongst the market in all the other regions, is projected to hold a majority of the share by the end of 2035. The increasing investment in the field of technology as well as the growing development of IT infrastructure to promote digital transformation and growth of the region besides the rise in the number of data centers is estimated to boost the regional market growth in the upcoming years.
Author Credits: Abhishek Verma, Hetal Singh
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