Data Center Infrastructure (DCI) Market - By Product (Cooling, Power, IT Racks & Enclosures, LV/MV Distribution, Networking Equipment, DCIM), By Component (Hardware, Software, Services), By Application & Forecast, 2024 – 2032

Data Center Infrastructure Market Size

Data Center Infrastructure Market was valued at USD 62.5 billion in 2023 and is estimated to register a CAGR of over 12.5% between 2024 and 2032. The market is growing due to increasing government efforts across the globe to enable enhanced data centers creating a huge demand in the market.
 

As governments focus on digitization, smart city planning, and data-driven governance, the need for robust data center infrastructure becomes critical. These initiatives aim to drive efficiency increase, enhance safety, and drive innovation across sectors. For instance, in March 2024, government-owned Bangladesh Data Center Company Limited (BDCCL) upgraded its data center by integrating Oracle Cloud Infrastructure (OCI) Dedicated Region. This OCI solution is now available to more than 30 government agencies in Bangladesh, ensuring compliance with data governance and privacy standards.
 

As a result, increasing emphasis is being placed on modernizing existing data centers and building new ones to meet the growing demand for data processing and storage. The data center infrastructure industry is proliferating due to enormous demand by governments to facilitate technological progress.
 

The demand for the data center infrastructure market is increasing due to the number of companies investing in advanced data centers. As companies increasingly rely on digital technologies, the need for robust and efficient data center infrastructure has never been greater. Companies are building advanced data centers to support the growing amount of data generated by their operations and to meet and compete with the requirements of emerging technologies such as Artificial Intelligence, Machine Learning, and the Internet of Things. For example, in February 2024, Digital Realty, a leading global provider of cloud and carrier-neutral data center, colocation, and interconnection solutions, unveiled its first data center in India, capable of supporting IT load capabilities.
 

Emerging technologies such as Artificial Intelligence (AI), Machine Learning (ML), and increasing edge computing support the demand for advanced data center infrastructure. AI and ML applications require huge computing power and data processing capabilities for high performance therefore, decentralized data center architectures are needed to reduce latency and enhance real-time performance of IoT devices and applications.
 

Despite steady growth, the data center infrastructure market has several limitations. The biggest challenge is the huge initial investment required to set up and maintain data centers. The costs associated with land, construction, equipment, and energy use can be prohibitive, especially for small businesses. Additionally, stringent regulations and environmental concerns pose challenges for data center operators. Complying with data protection and privacy laws requires investing heavily in security measures and regular audits. Additionally, high energy consumption in data centers contributes to environmental concerns, including the need to invest in sustainable practices and energy-efficient technologies, which ultimately hinder market growth.
 

Data Center Infrastructure Market Trends

The market is experiencing significant growth driven by new expansions and initiatives by leading companies. A key trend is the rise of the hyperscale data center, driven by increasing demand for cloud services and storage. Companies like Google, Amazon, and Microsoft are expanding their data center footprints globally to accommodate the growing amount of data and support emerging technologies like AI and IoT.
 

Another trend is the adoption of modular data center solutions, allowing rapid and scalable deployment. Additionally, there has been a growing emphasis on sustainable development, and companies are investing in renewable energy and energy-efficient technologies to reduce environmental impact. Furthermore, edge computing is gaining traction, and introducing edge data center developments to support ease of use and IoT devices indicates a dynamic and growing landscape in the data center infrastructure industry.
 

Citing an instance, in March 2024, Space World Group founder and chairman Ankit Goel announced plans to connect all data centers in seven major cities with optical fiber networks within a year. A subsidiary of the group, Constl, a fiber-based digital infrastructure provider, is planning to deploy a vast network of neutral point-to-point optical fiber connections in these data centers.
 

Data Center Infrastructure Market Analysis

Based on product, the market is segmented into cooling, power, IT racks & enclosures, LV/MV distribution, networking equipment, DCIM. In 2023, the network equipment segment was valued at over USD 23 billion in 2023. Network equipment, including switches, routers, and cabling solutions, form the backbone of data center infrastructure, providing seamless data transfer and connectivity. As data centers expand and modernize to support growing data volumes, the market could witness an influx of advanced technologies. Moreover, with the rise of cloud computing, edge computing, and virtualization, data centers need advanced networking solutions to ensure low latency, high reliability, and high data transfer efficiency, creating a high demand in the market.
 

Based on component, the market is categorized into hardware, software, and service. The hardware segment is anticipated to register a CAGR of over 11% from 2024 to 2032. Servers, storage devices, and cooling systems are among the components needed to operate and maintain a data center. The demand for hardware components is increasing due to the exponential growth of data generated by businesses and consumers. Additionally, advances in technology, such as the adoption of Solid-State Drives (SSDs) for faster data processing and energy efficiency in cooling systems, further fuel the demand for new hardware components. 
 

North America dominated the global data center infrastructure market with a major share of over 40% in 2023. Numerous industries, such as manufacturing, construction, aerospace, mining, and logistics, are based in North America. As manufacturing, assembly, and logistics industries continue to grow and modernize, the demand for effective material handling solutions such as data center infrastructure is increasing.
 

The region’s robust digital economy, with widespread adoption of cloud computing, big data analytics, and IoT technologies, necessitates advanced data center infrastructure. With leading tech hubs like Silicon Valley and booming industries that use data related to finance, healthcare, and e-commerce, the demand could flourish. Furthermore, North America is leading the way in data center investments and increased compliance requirements, further contributing to market growth. As enterprises expand their digital footprint, the demand for flexible, scalable, and efficient data center infrastructure continues to grow in North America.
 

In the Asia Pacific region, the data center market is witnessing robust growth fueled by factors such as increasing digitalization, rapid urbanization, and the proliferation of mobile devices. Countries like China, India, Japan, and Singapore are emerging as key hubs for data center investment, driven by rising demand for cloud services, e-commerce, and digital content consumption. Moreover, the deployment of advanced technologies like artificial intelligence (AI), Internet of Things (IoT), and 5G is driving the need for scalable and resilient data center infrastructure. Government initiatives aimed at promoting digitalization, coupled with regulatory measures to enhance data security and privacy, are further propelling market growth.
 

Data Center Infrastructure Market Share

Schneider Electric SE, Dell, Inc, and Hewlett-Packard Enterprise Company held significant market share of over 20% market share in 2023. These major players are continually innovating and expanding their offerings to meet the growing demands of customers. They are also actively exploring emerging technologies like edge computing and 5G to stay competitive and address the requirements of customers seeking low-latency, high-performance computing solutions. Strategic partnerships, acquisitions, and investments in sustainability and energy efficiency initiatives further underscore the commitment of major players to drive innovation and growth in the dynamic DCI market.
 

Company efforts specifically targeting the data center infrastructure industry are driving the demand significantly. With companies increasingly relying on digital technologies, the need for a modern and efficient database is paramount. Companies are expanding and modernizing data centers to handle growing volumes of data and support emerging technologies such as cloud computing and edge computing. Furthermore, efforts to improve security and energy efficiency have been successfully implemented contributing to the continued demand for advanced data center infrastructure solutions.
 

Data Center Infrastructure Market Companies

Major players operating in the market are:

• ABB Ltd.
• Dell, Inc
• Eaton Corporation
• Hewlett-Packard Enterprise Company
• Huawei Technologies Co., Ltd.
• IBM Corporation
• Mitsubishi Electric Corporation
• Panduit Corporation
• Schneider Electric SE
• Vertiv Group Corp.
   

Data Center Infrastructure Industry News

• In January 2024, The Adani Group unveiled its intention to invest $6 billion in data center infrastructure in Maharashtra, India. Under the MoU with the Maharashtra government, investments will be made over the next ten years to develop 1 gigawatt (GW) of data center capacity.
   
• In March 2024, Microsoft announced the availability of its first data center location: Mexico Central. This data center segment delivers scalable, highly available, and affordable cloud services to organizations around the world and underscores Microsoft’s commitment to driving digital transformation and sustainable innovation in the country.
   
• In March 2024, Schneider Electric, a leader in energy management and automation, announced a partnership with Nvidia to enhance data center infrastructure optimization. Using its expertise in data center infrastructure, Schneider Electric will work with Nvidia’s advanced AI technologies to deliver the first publicly available AI data center reference designs.
   

The data center infrastructure market research report includes in-depth coverage of the industry with estimates & forecasts in terms of revenue (USD Billion) from 2021 to 2032, for the following segments:

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Market, By Product

• Cooling
• Power
  • UPS
• IT racks & enclosures
• LV/MV distribution
• Networking equipment
• DCIM

Market, By Component

• Hardware
• Software
• Service

Market, By Application

• BFSI
• Colocation
• Energy
• Government
• Healthcare
• Manufacturing
• IT & telecom
• Others

The above information is provided for the following regions and countries:

• North America
  • U.S.
  • Canada
  • Mexico
• Europe
  • UK
  • Germany
  • France
  • Spain
  • Poland
  • Benelux
  • Rest of Europe
• Asia Pacific
  • China
  • India
  • Japan
  • Australia
  • Singapore
  • Indonesia
  • Rest of Asia Pacific 
• Latin America
  • Brazil
  • Argentina
  • Colombia
  • Chile
  • Peru
  • Rest of Latin America
• MEA
  • GCC
  • South Africa
  • Rest of MEA